Goods and services which are sold overseas 2.G&S which are bought from other countries
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What is the Balance of Payments
A record of all transaction relating to international trade and is divided into two parts
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Describe the Current Account
Shows the value of all imp and exp over a period of time. Includes visible and invisible trade and income.
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What are Capital and Financial Imports
Records flow of money into and out of a country resulting from transactions relating to savings etc
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What is a current account balance
Difference between total exports and total imports.
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What is a current account deficit
Value of imports is greater than the value of exports. (Spending more than buying)
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What is a current account surplus
Value of exports is greater than the value of imports. (Buying more than spending)
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What is visible trade
To do with the buying and selling of physical goods
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What is the visible balance/balance of trade
The difference between the total value of visible exports and imports
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What is invisible trade
The exchange of services. Include Primary income (from loans)and Secondary Income (Gov transactions)
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What is Exchange Rate
Price of one currency in terms of another
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What is the negative correlation between the current account and exchange rate
If ER increases, Exports are more expensive and imports cheaper. Increase in demand for imports and a fall in demand for exports
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Reasons for Deficits and Surpluses
Quality of Domestic and Foreign Goods. Price of Domestic and Foreign Goods
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Business activity that damages the environments
Mining. Power Generations. Chemical Processing. Agriculture. Construction
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Ways businesses damage the environment
Visual Pollution. Noise Pollution. Air Pollution and Water Pollution.
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Government Intervention to Protect the Environment
Taxation. Subsidies. Regulation. Fines. Pollution Permits. Provision of Parks
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What is income equality
The differences in income that exist between the different groups of earners in society, the gap between the rich and poor
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Reasons for income equality
Shorts of qualified labour. Pensioners receive lower incomes. How the gov redistributes income through taxes and welfare. People who have assets enjoy additional income.
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What is absolute poverty
Wher people don't have enough resources to meet all of their basic human needs. Common in poor countries
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What is relative poverty
Relative to existing living standards for avg individuals. Common in richer countries
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Reasons to reduce poverty and inequality
Meet basic needs. Raise living standards. Ethical Reasons
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Gov intervention to reduce poverty and income equality
Progressive Taxation. Redistribution through benefit payments. Investment in Education and Health Care
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What is progressive Taxation
Where the proportion of income paid in tax rises as the income of the taxpayer rises.
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Other cards in this set
Card 2
Front
What is the Balance of Payments
Back
A record of all transaction relating to international trade and is divided into two parts
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