Intro To Business Chapter 3

Front 1

Define economy

Back 1

A financial and social system of how resources flow through Society from production to distribution to consumption.

Front 2

Define economics

Back 2

The study of the choices that people companies and governments make in allocating societies resources.

Front 3

Define macroeconomics

Back 3

The study of a country's overall economic issues such as the employment rate the gross domestic product and Taxation policies.

Front 4

Define microeconomics

Back 4

The study of smaller economic units such as individual consumers families and individual businesses.

Front 5

Define Fiscal policy

Back 5

Government efforts to influence the economy through taxation and spending.

Front 6

Define budget surplus

Back 6

Overages that occur when revenues are higher than expenses over a given period of time.

Front 7

Define budget deficit

Back 7

Shortfalls that occur when expenses are higher than Revenue over a given period of time.

Front 8

Define federal debt

Back 8

The sum of all the money that the federal government has borrowed over the years and not yet repaid.

Front 9

Define monetary policy

Back 9

Bank of Canada decisions that shape the economy by influencing interest rates and the supply of money.

Front 10

Define money supply

Back 10

The total amount of money within the overall economy.

Front 11

Define M1 money supply

Back 11

Includes all currency Plus checking accounts and traveler's checks.

Front 12

Define M2 money supply

Back 12

Includes all of my money Supply Plus most savings account money market accounts and certificates of deposit.

Front 13

Define open market operations

Back 13

The Bank of Canada function of buying and selling government securities which include treasury bonds notes and bills.

Front 14

Define bank rate

Back 14

The rate of interest that the Bank of Canada charges when it loans funds to Banks.

Front 15

Define reserve requirement

Back 15

A rule that specifies the minimum amount of reserves or funds A Bank must hold expressed as a percentage of the bank's deposits.

Front 16

Define cdic Canada Deposit Insurance Corporation

Back 16

A federal Crown corporation that insures deposits in Banks and thrift institutions for up to $100,000 per customer per Bank.

Front 17

Define economic system

Back 17

A structure for allocating limited resources.

Front 18

Define capitalism

Back 18

An economic system also known as the private Enterprise or free market based on private ownership, economic freedom, and Fair competition.

Front 19

Define pure competition

Back 19

A market structure with many competitors selling virtually identical products . Barriers to entry are quite low.

Front 20

Define monolithic competition

Back 20

A market structure with many competitors selling differentiated products. barriers to entry are low

Front 21

Define oligopoly

Back 21

A market structure with only a handful of competitors selling products that are either similar or different. barriers to entry are typically High

Front 22

Define monopoly

Back 22

A market structure with one producer completely dominating the industry leaving no room for any significant competitors. Barriers to entry tend to be virtually insurmountable.

Front 23

Define natural monopoly

Back 23

A market structure with one company as the supplier of a product because the nature of that product makes a single supplier more efficient than multiple competing. Most natural monopolies are government sanctioned and regulated.

Front 24

Define supply

Back 24

The quantity of products that producers are willing to offer for sale at different market prices.

Front 25

Define supply curve

Back 25

The graft relationship between price and quantity from A supplier standpoint.

Front 26

Define demand

Back 26

The quantity of products that consumers are willing to buy at different market prices.

Front 27

Define demand curve

Back 27

The graft relationship between price and quantity from a customer demand standpoint.

Front 28

Define equilibrium price

Back 28

The price associated with a point at which the quantity demanded of a product equals the quantity supplied. Also known as the market price.

Front 29

Define socialism

Back 29

An economic system based on the principle that the government should own and operate Katie Enterprise's that directly affect public welfare.

Front 30

Define communism

Back 30

An economic and political system that calls for public ownership of virtually all Enterprises under the direction of a strong central government.

Front 31

Define mixed economies

Back 31

Economies that embody elements of both planned and market-based economic systems.

Front 32

Define privatization

Back 32

The process of converting government-owned businesses to private ownership.

Front 33

Define gross domestic product

Back 33

The total value of all final goods and services produced within a nation's physical boundaries over a given period of time.

Front 34

Define unemployment rate

Back 34

The percentage of people in the labor force of employment age who do not have jobs and are actively seeking employment.

Front 35

Define business cycle

Back 35

The periodic contraction and expansion that occurred over time in virtually every economy.

Front 36

Define contraction

Back 36

A. Of economic downturn marked by Rising unemployment and falling business production.

Front 37

Define recession

Back 37

An economic downturn marked by decrease in the GDP for two consecutive quarters.

Front 38

Define depression

Back 38

And especially deep and long-lasting recession.

Front 39

Define recovery

Back 39

A period of rising economic growth and employment.

Front 40

Define expansion

Back 40

A period of robust economic growth and high employment.

Front 41

Define inflation

Back 41

A period of rising average prices across the economy.

Front 42

Define hyperinflation

Back 42

An average monthly inflation rate of more than 50%.

Front 43

Define disinflation

Back 43

A period of slowing average price increases across the economy.

Front 44

Define deflation

Back 44

A period of falling average prices across the economy.

Front 45

Define consumer price index

Back 45

A measure of inflation that evaluates the change in the weighted average price of goods and services that the average consumer buys each month.

Front 46

Define producer Price Index

Back 46

A measure of inflation that evaluates the change over time in the weighted average wholesale prices.

Front 47

Define productivity

Back 47

The basic relationship between the production of goods and services (output ) and the resources needed to produce them (input) calculated via the following equation : output divided by input equals productivity.