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33 Cards in this Set
- Front
- Back
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Absolute Advantage |
When a country can make more of a given product using fewer resources than another nation. Unit cost is lower. |
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Active Demand Managment |
Government use of fiscal or monetary policy to change levels of aggregate demand. |
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Actual GDP |
The level of GDP produced by a country in a given time period, usually 1 year.
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Actual Economic Growth |
An increase in real GDP from using more of an economy's existing resources. Short run economic growth. |
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Aggregate Demand |
Total spending on domestic output at a given price level, over a given time period, usually 1 year. |
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Aggregate Supply |
Shows the total output domestic producers are willing and able to produce at a given price level, over a given time period, usually 1 year. |
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Anticipated Inflation |
The expected rate of inflation for the near future. |
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Appretiation |
An increase in the value of an asset or the exchange rate. |
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Automatic Stabilisers |
changes in taxes and government spending beyond the control of government and brought about by the economic cycle. |
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Average Propensity to Consume |
The proportion of household income spent on products. |
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Balance of Payments |
A record of economic transactions between residents of a country and the rest of the world, over a period of time, usually 1 year. |
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Balanced Budget |
Government revenue equals government expenditure. |
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Bank |
A financial institution that accepts deposits from savers and makes loans to borrowers. |
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Base Rate |
The interest rate set by the Bank of England. Commercial banks set their own interest rates for mortgages and loans around this base rate. |
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Borrowing |
Gaining credit from a lender to be repaid, with interest, within a defined time period. |
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Budget |
Expected annual government income and expenditure. |
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Budget Deficit |
Government revenue is less than government expenditure. |
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Budget Surplus |
Government revenue is greater than government expenditure. |
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Capital and Financial Account |
A record of money flows between UK and overseas residents from the purchase of fixed or financial assets -eg- factories shares and loans. |
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Central Bank |
A country's main bank, which issues currency, enacts monetary policy, and is banker to the government and commercial banks. |
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Circular Flow of Income |
The movement of spending and income across an economy. |
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Comparative advantage |
The ability to produce a product at a relatively lower opportunity cost than other countries, regions or individuals. |
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Comprehensive Spending Review |
Government spending plans for the medium term -eg- next 3 years. |
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Consumtion |
Domestic household spending on consumer products. |
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Cost Push Inflation |
Inflation caused by increasing prices of inputs -eg- wage prices or indirect tax. |
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Current Account |
A record of money flows between UK and overseas residents arising from trade in goods/services and investment income from owning overseas assets. |
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Cyclical Unemployment |
The number of jobless people due to insufficient aggregate demand compared to aggregate supply. |
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Deflation |
A sustained decrease in the general price level. |
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Deflationary Policies |
Government measures to lower total aggregate demand and spending -eg- higher interest rates. |
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Demand Managment |
Government intervention in the economy to change the level of AD. |
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Demand Pull inflation |
Inflation resulting form increases in AD unaccompanied by an increase in AS, "too much money chasing too few goods". |
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Depreciation |
A fall in the value of an asset or an exchange rate. |
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Discretionary Fiscal Policy |
The government deliberately adjusts its spending and taxation to influence the overall level of economic activity. |
