Chapter 12 & 13 Vocab Flashcards
(21 cards)
What are natural resources?
The inputs into the production of good and services that are provided by nature, such as land, rivers, and mineral deposits
What is physical capital?
The stock of equipment and structures that are used to produce goods and services
What is productivity?
The quantity of goods and services produced from each unit of labor input
What is brain drain?
The tendency of highly educated workers to emigrate and leave poor countries
What is human capital?
The knowledge and skills that workers acquire through education, training, and experience
What is technological knowledge?
Society’s understanding of e best ways to produce goods and services
What is the catch-up effect?
The property whereby countries that start off poor tend to grow more rapidly than countries that start off rich
What is diminishing returns?
The property whereby the benefit from an extra unit of an input declined as the quantity of the input increases
What are financial intermediaries?
Financial institutions through which savers can INDIRECTLY provide funds to borrowers
What are financial markets?
Financial institutions through which savers can DIRECTLY provide funds to borrowers
What is a market for loanable funds?
The market in which those who want to save supply funds and those who want to borrow to invest demand funds
What is a financial system?
The group of institutions in the economy that helps to match one person’s saving with another person’s investment
What is national savings?
The total income in the economy that remains after paying for consumption and government purchases
Y-C-G
What is private savings?
The income that households have left after paying for taxes and consumption
Y-T-C
What is crowding out?
A decrease in investment that results from government borrowing
What is a mutual fund?
An institution that sells shares to the public and uses the proceeds to buy a portfolio of stocks and bonds
What is public savings?
The tax revenue that the government has left after paying for its spending
T-G
What is a budget surplus?
An excess of tax revenue over government spending
T-G > 0
What is a budget deficit?
A shortfall of tax revenue from government spending
T-G < 0
What is a bond?
A certificate of indebtedness (IOU)
What is stock?
A claim to partial ownership in a firm
