Economic terms

  • Created by: Alice
  • Created on: 08-04-13 09:00
Global economy (gross world product): ‎
sum of the total goods and services produced over a period of time
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Globalisation
the integration between different countries and economies and the increased impact of international ‎influences on all aspects of life and economic activity
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World trade organisation (wto): ‎
an organisation of 155 member countries that implements and advances global trade agreements and ‎resolves trade disputes between nations
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Foreign exchange markets: ‎
the networks of buyers and sellers exchanging one currency for another in order to facilitate flows of ‎finance between countries
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Speculators: ‎
Investors who buy or sell financial assets with the aim of making profits from short term price ‎movements
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International monetary fund: ‎
an international agency that consists of 188 members and overses the stability of the global financial ‎system
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Foreign direct investment: ‎
the movement between economies for the purpose of establishing a new company or buying a ‎substantial proportion of shares in an existing economy
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Transnational corporations: ‎
global companies that dominate global product and factor markets
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Labour markets ‎
the market in which workers compete for jobs and employers compete for workers
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Migration
the movement of people between countries on a permanent or long term basis
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International division of labour
how the tasks of production process are allocated to different people globally
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Business cycle
the fluctuations in the level of economic growth due to either domestic of international factors
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International business cycle
the fluctuations in the level of economic activity in the global economy over time
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Regional business cycle
the fluctuations in the level of economic in a geographic region of the global economy over time
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Free trade
a situation where there are no artificial barriers to trade imposed by the government s for the purpose ‎of shielding domestic producers from foreign competitors
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Comparative advantage
the economic principal that nations should specialise in the areas of production in which they have the ‎lowest opportunity cost and trade with other nations as to maximise living standards
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Opportunity cost
the alternative use of resources
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Protection
the government policies that give domestic producers an artificial advantage over foreign competitors, ‎such as tariffs on imported goods
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Infant Industries
new industries
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Dumping
the practice of exporting goods to a country at a price lower than their selling price in their country of ‎origin
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Tariffs
taxes on imported goods imposed for the purpose of protecting Australian industries
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Quota
the restrictions on the amounts or values of various kinds of goods that may be imported ‎
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Tariff Quotas
goods are imported up to the quota pay the standard tariff rate, whereas goods imported above the ‎quota pay a higher rate
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Subsidies
the cash payments from the government from the government to businesses to encourage ‎production of a good or service and influence the allocation of resources in an economy
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Local content rules
rules that specifiy that goods must contain a minimum percentage of locally made parts
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Export incentives
programs which give domestic producers assistance such as grants, loans or technical advice, and ‎encourage businesses to penetrate global markets or expand their market share
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Trading bloc
when a number of countries join together in a formal preferential trading agreement to the exclusion ‎of other countries
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Free trade agreements
formal agreements between countries designed to break down barriers to trade between those ‎nations ‎
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Dispute resolution
a resolution process which is commenced if no agreement can be reached directly
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Doha round
trade liberalisation talks that were launched in 2001‎
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World bank
a global organisation whose main role is to assist poorer nations with economic development through ‎loans, development assistance and technical advice, with the primary aim of halving global poverty
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G20‎
a forum of the government leaders which meet and negiotiate agreements on global economic ‎challenges
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Purchasing power parity (PPP)‎
a theory that states that exchange rates should adjust to equalise the price of identical goods and ‎services in different economies throughout the world
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Gross national income
the sum of value added by all resident producers in an economy plus receipts or primary income from ‎foreign sources
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Economic development
a broad measure of welfare in a nation that includes indicators of health, education and environmental ‎quality as well as material living standards
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Human development index
a measure of economic development devised by the united nations development program
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Life expectancy at birth
an indicative of the health and nutrition standards within a country
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Levels of educational attainment
the level of skills in the workforce and the measure of the future development of the economy
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Gross national income per capita
measures the sum of gross value added by all resident producers in the economy, plus income from ‎foreign sources, on a purchasing power parity basis
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Millennium Development Goals
a guided efforts by international organisations to improve economic development in poorer countries
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Advanced economies
high income, industrialised or developed economies ‎
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Developing economies
experience low living standards, low education levels and generally have agriculture based economies ‎with poor infrastructure and economic and political institutions
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‎ LDCs
countries which suffer from the lowest GNI per capita levels in the world; weak human assets and high ‎economic vulunrability.‎
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Emerging economies
the process of industrialisation and experiencing sustained high levels of economic growth ‎
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Natural resources
all the resources provided by nature that are used in the production process
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Institutional factors
factors which affect the ability of a nation to achieve economic development
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Net capital importer
the level of foreign investment in Australia consistently remaining close to twice the level of Australian ‎investment abroad
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Direct investment
the establishment of a new company, or the purchase of a substantial proportion of shares in an ‎existing company
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Portfolio investment
loans, other forms of securities and smaller shareholders in companies ‎
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Balance of Payments
the record of the transactions between Australia and the rest of the world during a given period, ‎consisting of the current account and the capital and financial account
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Current account
the part of the balance of payments that shows the receipts and payments for trade in goods and ‎services, transfer payments and income flows between Australia and the rest of the world in a given ‎time period
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Net goods
the difference between what Australia receives for its exports and pays out for its imports of goods
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Net services
the services that are bought and sold without people receiving a ‘good’ ‎
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Net primary income
the earnings on investments
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Net secondary income
the non-market transfers
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Capital and financial account
records of the borrowing, lending, sales and purchases of assets between Australia and the rest of the ‎world
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Financial account
australia’s transactions in foreign financial assets and liabilities ‎
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Capital account
consists of capital transfers and debt forgiveness ‎
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Net errors and omissions
the statistical discrepancies within the capital account
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International debt
foreign debt
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Foreign investment
foreign equity
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Cyclical factors
factors that vary with the level of economic activity – such as changes in global demand for ‎commodities – such as changes in global demand for commodities, Australia’s terms of trade and the ‎value of the exchange rate
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Structural factors
factors which are underlying of persistent influences on the balance of payments – such as the ‎structure of australia’s export base, the international competitiveness of australia’s exports and the ‎level of national savings
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Exchange Rate
value of one currency for the purpose of conversion to another. ‎
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Terms of trade
measures the relative movements in the prices of an economy’s imports and exports over a period of ‎time
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Balance of payments constrain
the extent to which an economy’s capactity to grow is constrained by its need to keep the current ‎account defecit at a sustainable level
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Foreign exchange market
the place where currency conversion takes place and where the forces of supply and demand, or in ‎the case of a fixed exchange rate determines to the price of one country’s currency
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Floating exchange rate
the value of an economy’s currency is determined by the forces of supply and demand in foreign ‎exchange markets
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‎ Demand
the $A is represented by all the people who wish to buy $A ‎
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International competitiveness
the measure of the ability of Australian producers to compete with overseas producers in both local ‎and world markets
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Supply
the $A is represented by all the people who wish to sell the $A
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Trade Weighted Index
a measure of the value of the Australian dollar against a basket of foreign currencies of major trading ‎partners. These currencies are weighted according to their significance to australia’s trade flows
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Valuation effect
where an appreciation (or depreciation) of the currency causes an immediate decrease (or increase) in ‎the Australian dollar value of foreign debt that is borrowed in foreign currencies ‎
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Foreign Reserves
Deposits of a foreign currency held by a central bank. Holding the currencies of other countries ‎as assets allow governments to keep their currencies stable and reduce the effect of economic shocks. ‎The use of foreign exchange reserves became popul
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Flexible peg
where the currency’s value is fixed at a pre-announced level, but it can be changed by the central bank ‎in response to the forces of supply and demand in forex markets
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Fixed exchange rate system
where the value of the currency is normally determined by the central bank, either for the long run or ‎on a day to day basis through a flexible peg system
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Export Market Development Grants
A scheme which reimburses exporters for some of their costs in promoting their exports in new ‎markets ‎
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Bilateral trade agreements
Agreements which only involve two nations
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Multilateral Trade agreements
Agreementsa that provide for free or preferential trade between many countries, usually on a ‎regional basis
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Protection
the government policies that give domestic producers an artificial advantage over foreign competitors, ‎such as tariffs on imported goods
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Other cards in this set

Card 2

Front

the integration between different countries and economies and the increased impact of international ‎influences on all aspects of life and economic activity

Back

Globalisation

Card 3

Front

an organisation of 155 member countries that implements and advances global trade agreements and ‎resolves trade disputes between nations

Back

Preview of the back of card 3

Card 4

Front

the networks of buyers and sellers exchanging one currency for another in order to facilitate flows of ‎finance between countries

Back

Preview of the back of card 4

Card 5

Front

Investors who buy or sell financial assets with the aim of making profits from short term price ‎movements

Back

Preview of the back of card 5
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