Economic term #1 Flashcards
(5 cards)
1
Q
Cash rate
A
The interest rate that banks pay to borrow funds from other banks in the money market overnight.
2
Q
Monetary policy
A
- Operated by the RBA
- Manages the level of spending and economic activity in the economy by setting the cash rate target.
3
Q
Interdependence
A
Countries relying on each other for trade, investment and resources.
4
Q
Price mechanism
A
The way prices guide economic decisions about what to produce, how much to produce and who gets the goods and services.
5
Q
Market failure
A
When the market for goods and services do not produce ideal outcomes.
