CHAPTER 8 - Economy and need fulfilment in Denmark

Question 1

What are the human needs?

Answer 1

Human needs can be broken down into two categories: basic needs and needs for growth and self-actualization. Basic needs include necessities such as food, water, shelter, and safety, which are necessary for survival. Needs for growth and self-actualization include things like education, creativity, a sense of community, and spiritual fulfillment, which are necessary for personal development and fulfillment beyond mere survival. These needs are often linked to quality of life and overall well-being.

Question 2

How does Denmark’s economy work?

Answer 2

Denmark’s economy works primarily as a mixed-market economy, with Denmark having a strong welfare state system and an open economy. The country’s economy is characterized by a high degree of flexibility and competitiveness, an excellent infrastructure, and a highly educated population. Denmark also has a well-functioning labor market and a highly developed welfare system, which is supported by a comprehensive tax system that provides a high level of social security to its citizens.

Question 3

What is sound economy?

Answer 3

A sound economy is an economy that is stable and sustainable, with low levels of inflation, steady economic growth, low levels of unemployment, and a fair distribution of income and wealth. A sound economy is one that is able to weather economic shocks and maintain its stability over the long term.

Question 4

What are economic mechanisms?

Answer 4

Economic mechanisms are the processes and tools used by governments to manage their economies and achieve their desired goals. These mechanisms include mechanisms like fiscal policy, which involves the government’s use of taxation and expenditure policies to influence economic activity, and monetary policy, which involves the use of interest rates and other monetary tools to manage the money supply and influence economic activity. Other economic mechanisms include market supply and demand, price elasticity, and various forms of regulation.

Question 5

Balance of payments

Answer 5

This refers to the systematic record of all economic transactions made by a country’s individuals, firms and government agencies with the rest of the world, usually over a specific time period, such as a year.

Question 6

Civil society

Answer 6

This a broad term that refers to the range of non-governmental and not-for-profit organizations that form a critical component of democratic societies around the world.

Question 7

Competitiveness

Answer 7

This is a term used to describe the relative ability of a firm, industry or country to produce goods and services that are of comparable quality and price to those produced elsewhere.

Question 8

Contractionary fiscal policy

Answer 8

This is a type of fiscal policy which involves reducing government spending or increasing taxes, with the aim of reducing the overall level of demand in the economy.

Question 9

Cyclical fluctuations

Answer 9

These are the normal fluctuations that occur in an economy around the long-term trend of growth, typically due to variations in consumer demand for goods and changes in macroeconomic policies.

Question 10

Deficiency needs

Answer 10

These are the basic physical, psychological, and social needs that humans require in order to sustain their life and well-being.

Question 11

Demand

Answer 11

This refers to the quantity of goods and services that consumers are willing and able to buy at a given price level.

Question 12

Economic circuit

Answer 12

This is a process by which money circulates through the economy from households to firms and back again, as goods and services are produced and exchanged.

Question 13

Economic growth

Answer 13

This refers to the increase in the production, consumption, and distribution of goods and services over time.

Question 14

Economic reforms

Answer 14

These are policy measures implemented by governments with the aim of improving the performance of their economies, usually aimed at deregulation, lower taxes, and privatization.

Question 15

Expansionary fiscal policy

Answer 15

This is a type of fiscal policy which involves increasing government spending or lowering taxes, with the aim of increasing the overall level of demand in the economy.

Question 16

Exports

Answer 16

These are goods and services produced domestically that are sold in foreign markets.

Question 17

Financial crisis

Answer 17

This occurs when a major disruption in financial markets and institutions severely affects the economy, causing widespread economic distress.

Question 18

Fiscal policy

Answer 18

This refers to the use of government spending and taxation to influence the economy.

Question 19

Goods

Answer 19

This refers to tangible items that are manufactured or produced, which people consume or use to produce other goods.

Question 20

Government budget balance

Answer 20

This refers to the difference between government spending and tax revenues in a particular period, usually a year.

Question 21

Gross domestic product (GDP):

Answer 21

This is the total value of all goods and services produced within a country’s borders over a given time period, usually a year.

Question 22

Growth needs

Answer 22

These refer to the higher-level needs that individuals require for personal development, including creativity, education, and spirituality.

Question 23

Imports

Answer 23

These are goods and services that are produced in foreign markets and sold domestically.

Question 24

Income groups

Answer 24

This refers to a categorization of the population based on their incomes, usually ranging from low to high.

Question 25

Inflation

Answer 25

This refers to an overall increase in prices over time, leading to a reduction in the purchasing power of money.

Question 26

Market

Answer 26

This refers to a place where buyers and sellers come together to exchange goods and services.

Question 27

Market economy

Answer 27

This refers to an economic system in which individual consumers and producers utilize the market mechanism to exchange goods and services with one another.

Question 28

Market mechanism

Answer 28

This refers to the use of market prices and the profit motive to coordinate economic decision-making and allocate resources.

Question 29

Mixed economy

Answer 29

This refers to an economic system that combines elements of a market economy and a planned economy.

Question 30

Monetary policy

Answer 30

This refers to the use of central bank policies, such as interest rates, to influence the overall level of economic activity and inflation.

Question 31

Need hierarchy

Answer 31

This refers to the theory of human needs developed by Maslow, which posits that people have needs that are arranged hierarchically, with basic physiological needs being at the bottom, and more complex developmental needs being higher up.

Question 32

Physiological needs

Answer 32

These refer to the basic physical needs of human beings such as food, water, shelter, and safety.

Question 33

Planned economy

Answer 33

This refers to an economic system in which the government controls all aspects of economic activity, including the production and distribution of goods and services.

Question 34

Price formation

Answer 34

This refers to the way prices are set in a particular market, usually due to supply and demand.

Question 35

Productivity

Answer 35

This refers to the amount of output that can be produced with a given amount of inputs, such as labour, capital, and technology.

Question 36

Prosperity

Answer 36

This refers to a state in which individuals and firms are experiencing high levels of economic well-being, usually measured by indicators such as high GDP, low unemployment, and high levels of consumption.

Question 37

Recession

Answer 37

This refers to a temporary decline in economic activity, typically marked by a decline in GDP, increased unemployment, and lower consumer confidence.

Question 38

Services

Answer 38

These are non-tangible items that are produced and sold, including things like healthcare, education, and entertainment.

Question 39

Structural policy

Answer 39

This refers to government policies and programs aimed at enhancing the long-term economic performance of specific industries, regions or social groups.

Question 40

Supply

Answer 40

This refers to the amount of goods and services that producers are willing and able to offer for sale at a given price point.

Question 41

Sustainable economy

Answer 41

This refers to an economy that is able to meet the basic needs of its people in the present, without compromising the ability of future generations to meet their own needs.