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Flashcards

Macro Key Words

Alex Brownlie Economics A level Inglês 77 flashcards

Flashcards do conjunto (77)

  1. 1Accelerator Effect"When planned capital investment has a positive correlation with the past and expected growth of consumer demand or national income."
  2. 2Aggregate Supply Shock"Either an inflation shock or a shock to potential national output."
  3. 3Appreciation"The rise in the market value of one exchange rate against another."
  4. 4Austerity"Economic policy aimed at reducing a government's deficit."
  5. 5Automatic Stabilisers"Automatic fiscal changes as the economy moves through stages of the business cycle."
  6. 6Brain Drain"Movement of highly skilled people from their own country to another nation."
  7. 7BRIC Economies"Brazil, Russia, India and China. Emerging Markets."
  8. 8Bubble"When the prices of assets rise sharply at a sustained rate exceeding fundamental valuations, making a sudden collapse likely. (e.g. 2007-08 recession caused by housing market bubble bursting.)
  9. 9Budget Deficit"When government spending is greater than tax revenues."
  10. 10Capacity Utilisation"Measures how much of the productive potential of the economy is being used. Falls during a recession, leading to a rise in spare capacity."
  11. 11Capital Market"A stock or a bond market where firms can raise money for investment purposes."
  12. 12Capital Stock"Value of the total inventory of capital inputs in the economy."
  13. 13Capital-Labour Substitution"Replacing workers with machines in a bid to increase productivity and reduce unit cost of production."
  14. 14Claimant Count"The number of people claiming unemployment-related benefits."
  15. 15Closed Economy"Economy operating without imports or exports."
  16. 16Comparative Advantage"The relative advantage that one country holds over another. Countries may benefit in specialising in exporting products for which it has the lowest opportunity cost."
  17. 17Consumer Price Index (CPI)"Measures the change in price of a weighted basket of consumer goods and services (excluding housing costs.)"
  18. 18Corporation Tax"Tax on the profits made by companies - 19% in the UK as of April 2017 Budget."
  19. 19Cost-push Inflation"An increase in the average price level caused by a sustained increase in firms' costs of production."
  20. 20Creeping Inflation"Small rises in the general price level over a long period."
  21. 21Current Account"Overall balance of credits minus debits for trade in goods and services, investment income and transfers."
  22. 22Cyclical Trade Deficit"Trade deficit that arises purely due to changes in the economy's cycle."
  23. 23Cyclical Unemployment"Unemployment caused by a lack of AD for goods and services. National output smaller than potential output leading to a negative output gap."
  24. 24Deflation"A sustained fall in the average price level of goods and services in an economy."
  25. 25Depreciation"A fall in the market value of one exchange rate against another."
  26. 26Depression"Severe recession where a nation's GDP falls by at least 10%."
  27. 27Deregulation"Reducing barriers to entry in order to make a market more competitive."
  28. 28Discretionary Fiscal Policy"Deliberate attempts to affect AD using changes in government spending, taxation and borrowing."
  29. 29Discretionary Income"Disposable income adjusted for spending on essential bills e.g fuel."
  30. 30Disposable Income"The value of money coming into a household, minus taxes."
  31. 31Dumping"When a producer in one country exports a product at a price below that it charges in its home market, or below the costs of supply."
  32. 32Economic Cycle"Variations in the annual rate of growth of an economy over time."
  33. 33Economic Shocks"Unpredictable events, such as volatile commodity prices."
  34. 34Expansionary Monetary Policy"A relaxation of monetary policy means an attempt to use and expansionary monetary policy to boost AD, output and jobs."
  35. 35Expenditure-switching Policies"Policies aimed at 'switching' expenditure from imports to domestically produced goods in order to improve b.o.p and stimulated GDP growth."
  36. 36Fiscal Deficit"Occurs when government expenditure is greater than the revenue from tax receipts in a particular year."
  37. 37Fiscal Policy"Government's ability to affect economic activity through changes in tax and public spending."
  38. 38Foreign Direct Investment (FDI)"An investment made from one country into another."
  39. 39Free Trade"When trade is allowed to occur without any form of restriction such as a tariff."
  40. 40G7"A group of seven major industrialised countries - Canada, France, Germany, Italy, Japan, the UK and the USA."
  41. 41GDP"Gross Domestic Product - total value of income/output/expenditure in an economy."
  42. 42Gini Coefficient"A measure of the extent to which poor households receive less than an equal share of income (income inequality.)"
  43. 43Globalisation"Deepening of relationships between countries of the world, reflected in increasing levels of overseas trade and investment."
  44. 44Gross National Income (GNI)"Income generated from the resources owned by inhabitants and businesses of a given country."
  45. 45Hot Money"Money that flows freely and quickly around the world looking to earn the best rate of return."
  46. 46Human Capital"Investment in education and training to increase the quality and flexibility of the labour force."
  47. 47Human Development Index (HDI)"An index to assess comparative levels of development in countries. Quantified in terms of literacy, life expectancy and purchasing power."
  48. 48Income Elasticity of Demand (YED)"Responsiveness of demand to a change in real income."
  49. 49Inflation"A sustained increase in the general/average price level for goods and services."
  50. 50Innovation"Changes to products or production processes. Important in improving dynamic efficiency and quality of goods and services."
  51. 51Investment"Spending on capital goods - including machinery and infrastructure."
  52. 52Labour Supply"The number of people able, available and willing to work at a given wage rate."
  53. 53Liquidity"The ease with which something can be converted to cash with little loss of value."
  54. 54Liquidity Trap"When very low interest rates have a strong effect on AD."
  55. 55Marginal Propensity to Consume (MPC)"The proportion of any additional income that is dedicated to spending."
  56. 56Marginal Propensity to Save (MPS)"The proportion of any additional income that is dedicated to saving."
  57. 57Marginal Rate of Tax"The rate of tax on the next unit (£1) of income earned."
  58. 58Money Supply"The entire quantity of a country's commercial bills, coins, loans and credit."
  59. 59Moral Hazard"When an insured party decides to take higher risks because they believe their losses be covered by someone else."
  60. 60Multiplier Effect"An initial injection into an economy causing a greater final increase in real GDP."
  61. 61Nationalisation"Bringing a privately owned asset, such as a company, under state control."
  62. 62Net Trade"The balance between the value of exports and imports."
  63. 63Nominal GDP"Monetary value of all goods and services produced expressed at current prices."
  64. 64Output Gap"Difference between actual and potential national output. A negative output means that an economy has a large margin of spare productive capacity."
  65. 65Paradox of Thrift"Consumers saving more in a recession reduces consumption and therefore AD. This impedes economic growth and thus lowers the general level of savings."
  66. 66Phillips Curve"Statistical relationship between unemployment and inflation."
  67. 67Price Stability"When there is low inflation and the price changes that occur have little effect on consumers' day-to-day decisions."
  68. 68Productive Potential"Productive capacity of the economy - boosted by high quality investment."
  69. 69Productivity"Measure of efficiency. How many units of output per worker per hour."
  70. 70Marginal Propensity to Import"Proportion of any change in income that is spent on overseas products."
  71. 71Marginal Propensity to Save"Proportion of any change in income that is saved rather than spent."
  72. 72Protectionism"Restricting trade through tariffs and other forms of import controls."
  73. 73Purchasing Power"The buying power of a unit of currency. Inversely related to inflation."
  74. 74Quantitative Easing (QE)"Introduction of new money into national supply by a central bank. Idea is to encourage banks/people to borrow and spend more to offset deflation."
  75. 75Recession"Two consecutive quarters of negative economic growth."
  76. 76Remittances"Sending of money to consumers in another economy."
  77. 77Retail Price Index (RPI)"Similar to CPI however includes housing payments and excludes the top 4% of earners."

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Descrição
Edexcel Macroeconomics Key Terms Flash Cards
Criado por
Alex Brownlie
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