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galaxy brain Flashcards

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1
Q

international trade

A

buying and selling of g&s between economies

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2
Q

free trade

A

trade in which no gov intervention (tariffs/import quota/subsidies) is present

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3
Q

exports

A

g&s produced domestically sold to foreigners

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4
Q

imports

A

g&s produced abroad sold domestically

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5
Q

economies of scale

A

unit cost advantages that a business may experience as an outcome of increasing its scale of operations

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6
Q

trade protection

A

gov intervention in international trade through imposing trade restrictions
prevent the free entry of imports into a country
protect the domestic econ from foreign competition

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7
Q

tariff

A

taxes on imported goods

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8
Q

import quota

A

a max legal limit to the Q of a g&s that can be imported over a particular time period to protect domestic producers

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9
Q

production subsidy

A

payment per unit of output granted by the government to domestic firms that compete with imports to increase their competitiveness compared to imports

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10
Q

export subsidy

A

payments per unit of export granted by the government to domestic firms
declared illegal by WTO

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11
Q

administrative barriers

A

lengthy procedures and extra costs used to discourage imports

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12
Q

dumping

A

it is the selling of a g&s in another country at a price below its unit CoP

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13
Q

economic cooperation

A

cooperation between countries in the form of trade agreements and removal of trade barriers

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14
Q

preferential trade agreement

A

agreement between 2 or more countries to lower trade barriers on particular products in trade between each other

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15
Q

bilateral trade agreement

A

trade agreement between 2 countries

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16
Q

multilateral trade agreement

A

trade agreement that involves many countries

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17
Q

regional trade agreement

A

trade agreement to promote trade liberalisation between a group of countries that are within a geo region

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18
Q

trading bloc

A

a group of countries that have agreed to reduce trade barriers

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19
Q

free trade area

A

a group of countries eliminating trade barriers between themselves

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20
Q

customs union

A

a group of countries eliminating trade barriers and adopting common policies towards non-member countries

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21
Q

common market

A

a group of countries eliminating trade barriers, adopting a common policy to non-member countries, and eliminate all restrictions on movements of any FoP

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22
Q

monetary union

A

a group of countries eliminating trade barriers, adopting a common policy to non-member countries, eliminate all restrictions on movements of any FoP, and adopt common currency and central bank

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23
Q

(function of) a country’s central bank

A

the government’s bank
implementing monetary policies: managing interest rates and money supply
managing exchange rate policy: buying and selling official reserves

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24
Q

(function of) World Bank

A

provides grants and low interest loans
offers policy advice and technical assistance to developing countries
coordinates projects with governments
reducing poverty levels and encouraging and safeguarding international investment

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25
(function of) World Trade Organisation (WTO)
to provide a forum for negotiating and monitoring trade liberalisation resolve trade disputes
26
(function of) International Monetary Fund (IMF)
promote international monetary cooperation and oversee the stability of the international monetary system lend money to help members in BoP difficulties
27
exchange rate
value of one country’s currency expressed in terms of the amount of another country’s currency
28
money supply
what a country prints
29
currency supply
what a country supplies in the exchange market
30
foreign direct investment (FDI)
long-term investment by a multinational corporation in a foreign country
31
foreign exchange market
a market where individuals buy & sell different national currencies
32
floating exchange rate
exchange rate of a currency is determined by the D and S of that currency on the foreign exchange market no gov intervention
33
appreciation
increase in the value of one currency against another increase amount of foreign currency that can be bought by this currency in floating
34
depreciation
decrease in the value of one currency against another decrease amount of foreign currency that can be bought by this currency in floating
35
fixed exchange rate
exchange rate fixed by the central bank of a country at a particular level not permitted to change in response to changes in currency demand and supply
36
exchange controls
restrictions made by the gov on the Q of foreign exchange that can be bought by domestic residents of a country
37
revaluation
a country under a fixed exchange rate system rises the value of its currency adopted when the value of the currency in the foreign exchange market is persistently lower than the fixed rate similar to appreciation: exports more expensive + imports cheaper
38
devaluation
a country under a fixed exchange rate system lowers the value of its currency adopted when the value of the currency in the foreign exchange market is persistently higher than the fixed rate similar to depreciation: exports cheaper + imports more expensive
39
overvalued currency
currency in the managed exchange rate system has a value higher than its equilibrium market value
40
undervalued currency
has a value lower than its equilibrium market value
41
credit
a transaction that brings money into the country | foreign country need to buy domestic currency to buy domestic g&s → creates D for domestic currency
42
debit
a transaction that involves a flow of money out of the country need foreign currency to buy foreign g&s → sell domestic currency → creates S of domestic currency
43
surplus
credits >>> debits
44
deficit
debits >>> credits
45
official borrowing
international borrowing by a government to help to cover a current account deficit
46
income equity
income is distributed based on one’s ability and work effort | how fairly income and opportunity are distributed between different groups in society
47
income equality
state when every member of a society receives exactly the same income
48
government expenditure
sum of government purchases of g&s and government transfer payments
49
distribution of income
how the nation’s total income is distributed amongst its population
50
poverty
inability to satisfy minimal consumption needs and basic necessities for living
51
absolute poverty
anyone living < USD 1.9 a day is considered to be living under extreme poverty a situation where a person/family does not have enough income to meet basic human needs
52
relative poverty
a concept that compares the income of individuals/households in a society with median incomes
53
poverty line
an income level that is minimally sufficient to maintain a family in terms of food, housing, clothing and medical care
54
Lorenz curve
illustrates the degree of inequality of income/wealth distribution in an economy more curvy line → more unequal
55
Gini coefficient
summary measure of the info contained in the Lorenz curve most widely used relative measure of income inequality Gini coefficient = area between Santino 45 and Lorenz curve/total area below Santino 45 more curvy line → closer to 1 → more unequal
56
transfer payment
payment granted to households without any corresponding output in return made by the government to redistribute income away from taxpayers and towards those in need of assistance by raising the poor’s disposable income e.g. unemployment benefits, child and single parent allowances, old age/disability pensions, student grants
57
universal basic income (UBI)
method intended to provide residents a sum of money that they would receive regardless of any other income
58
disposable income
the remaining income available for an individual to spend or save, after taxation
59
direct taxes
taxes paid directly to the gov tax authorities, fully and directly borne by taxpayers
60
proportional tax
tax which the average tax rate is same as taxable income | same tax rate → same % ↓ → no effect on income distribution
61
personal income taxes
taxes on the wages, rental income, interest income and dividends by households and individuals
62
corporate income taxes
taxes on the profits of corporations, firms or businesses that formed a legal body that is legally separate from its owners
63
wealth taxes
taxes on the ownership of assets
64
wealth
the total value of all assets owned by a person, firm, community, or country
65
progressive tax
tax which the average tax rate increases as taxable income increases decrease in disposable income of high-income group >>> low-income group income distribution more equal → narrow income gap
66
regressive tax
tax which the average tax rate decreases as taxable income decreases decrease in disposable income of high-income group <<< low-income group income distribution more unequal → widen income gap
67
economic development
a process that leads to an increase in the standards of living for a population as a whole multi-dimensional: quantitative and qualitative concept decreased poverty decreased inequalities increased employment opportunities increased access to g&s that satisfy basic needs
68
poverty cycle
a situation where present poverty causes future poverty | transmitted from generation to generation
69
opportunity
a set of circumstances that makes it possible for someone to do something
70
status
one’s social/professional position in society due to one’s education level, income and wealth
71
infrastructure
a type of physical capital resulting from investments | e.g. power, telecommunications, piped water supply, roads, ports, airports
72
appropriate technology
technology well-suited to particular economy, geography, ecology & climate conditions of a country
73
tariff escalation
countries impose low tariffs on raw materials and higher tariffs on processed produce raw materials are derived D value added make processed g&s ↑ profitable → protect domestic producers more difficult for less developed countries to expand into manufacturing
74
formal economy
registered and legally regulated market
75
informal economy
not registered and legally regulated market
76
capital flight
large-scale transfer of privately-owned financial capital to another country
77
indebtedness
how much money people owe from borrowing in the past
78
property rights
laws and regulations that define rights to ownership, use and transfer of property
79
land rights
rights and rules to possess, occupy and use land
80
economically less developed countries (ELDCs)
classified by the UN as low-income countries confronting severe structural impediments to sustainable development highly vulnerable to economic and environmental shocks have low levels of human assets
81
UN sustainable development goals (SDGs)
a collection of 17 global goals set by the UN to mobilise efforts to end all forms of poverty, fight inequalities and tackle climate change, while ensuring that no country is left behind
82
purchasing power parity
equalise purchasing power of Q of g&s in diff countries comparing GDP/GNI across countries may be misleading bc different P levels rich country overstate + poor country understate
83
Human Development Index (HDI)
a composite index that brings together three variables | life expectancy at birth, mean years of schooling and expected years of schooling, and GNI per capita (PPP)
84
OECD Better Life Index
an index to compare well-being across countries, based on 11 topics that the OECD has identified as essential, in the areas of material living conditions and QoL
85
Happy Planet Index
an index which is used to measure the collective happiness and well-being of a population adjusted for unsustainable resource use (ecological footprint) life expectancy inequalities
86
foreign aid
the international transfer of capital and g&s from a country or international organisation, for the benefit of a recipient country and its population
87
import substitution
protectionist policies that decrease domestic consumers’ dependence on imported g&s and promote the development of domestic industry by imposing trade protection policies
88
export promotion
protectionist measures aimed at increasing competitiveness of domestic producers in foreign markets
89
diversification
involves a reallocation of resources into new activities that broaden the range of g&s produced move from production and exporting of primary commodities and replace it with manufactured and secondary/tertiary services
90
social enterprise
a type of commercial organisation that aims to achieve a particular social goal to improve people's well-being & promote social change
91
trade liberalisation
moving to freer trade by decreasing or eliminating trade barriers

capitalism (4 decks)

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