Our Economy vocab

Question 1

Aggregate Demand

Answer 1

The total value of all the spending (demand) on (finished) goods and services by a nation over a period of time

Question 2

Balance of Trade

Answer 2

The difference between the value of a country’s imports and exports over a time period

Question 3

Bilateral agreement

Answer 3

An agreement between 2 nations

Question 4

Bonds

Answer 4

A loan to a company/government that pays investors a fixed interest rate

Question 5

Budget

Answer 5

A list of income and planned spending

Question 6

Budgetary policy (Fiscal policy)

Question 7

Cash rate

Answer 7

The official price of borrowing money - the interest rate that applies to the short-term money market

Question 8

Consume

Answer 8

Purchasing goods/services for direct use/ownership

Question 9

Cost (Supply side) inflation

Answer 9

A sustained increase in the price of goods/services caused by producers passing on increased production costs to consumers

Question 10

Demand inflation

Answer 10

Price increases caused by an excess of demand in the economy as a whole

Question 11

Deregulation

Answer 11

The removal of unnecessary direct government controls/restrictions/supervision from an area of the economy

Question 12

Economic growth

Answer 12

Measure of a country’s increase in GDP

Question 13

Economy

Answer 13

All activities undertaken for the purpose of production, distribution and consumption of goods and services within a country

Question 14

Exports

Answer 14

Goods/services sold by local businesses to overseas consumers

Question 15

Fiscal policy

Answer 15

The use of the federal government budget to influence the economic cycle

Question 16

Free trade

Answer 16

No artificial trade barriers between nations

Question 17

GDP

Answer 17

Gross Domestic Product - The total value of all goods/services produced in a country in a time period (usually a year)

Question 18

Imports

Answer 18

Goods/services from overseas businesses sold to local consumers

Question 19

Income

Answer 19

Money received on a regular basis from work/property/investments/welfare.

Question 20

Inflation

Answer 20

A general rise in the prices of goods and services in a whole economy

Question 21

Labour

Answer 21

Human skills/effort required to produce goods/services

Question 22

Labour market

Answer 22

The buying and selling of labour

Question 23

Laissez-faire

Answer 23

No government interference in the economy

Question 24

Macroeconomic

Answer 24

The economics branch emphasising the central role played by the level of aggregate demand

Question 25

Mark-up

Answer 25

A fixed percentage/figure added to the cost of goods/services to determine the selling price

Question 26

Microeconomic

Answer 26

The economics branch studying the smaller units making up the whole economy

Question 27

Monetary policy

Answer 27

The RBA changing interest rates to influence economic growth

Question 28

Mortgage

Answer 28

A loan from a financial institution (bank) where something is held a a security in case the loan isn't repaid.

Question 29

Multilateral agreement

Answer 29

An agreement between 2 or more nations

Question 30

Multinational corporations (MNCs)

Answer 30

Large business organisations with a home base in one country and partially/wholly operated businesses in other countries

Question 31

Negative externalities

Answer 31

An unintended negative production outcome that impacts society/the economy

Question 32

Protection (protectionist)

Answer 32

Policy where a government gives local producers and artificial advantage

Question 33

Qualitative measures

Answer 33

Determining quality of life/the economy by examining qualitative indicators like freedom/security

Question 34

Quarterly

Answer 34

Every 3 months

Question 35

Quotas

Answer 35

Quarterly limits/targets for production or imports

Question 36

Recession

Answer 36

A relatively mild contraction in the level of economic activity resulting in reduced spending/rising unemployment/slow economic growth

Question 37

Regimen

Answer 37

A basket of goods/services whose prices are surveyed do calculate inflation

Question 38

Subsidies

Answer 38

A cash payment from the government to help local producers by enabling them to sell their products for a lower price and compete with overseas businesses

Question 39

Sustainable

Answer 39

Able to last of a long time

Question 40

Tarrifs

Answer 40

A tax on imports