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Our Economy
27 cards·by JZ_R5
circular flow model
model showing the relationships between sectors of the economy
money flows
funds exchanged for real flows in the economy
real flows
resources exchanged for money flows in the economy
gross domestic product
the value of a nation's output in one year
boom
the GDP is relatively high
Recession
two successive quarters of falling GDP
recovery
increasing GDP from a recession
inflation
an increase in overall prices in the economy
consumers price index
way of measuring changes in overall prices
interest rate
cost of borrowing/ return on deposit
reserve bank
responsible for keeping overall prices stable
state
the government
welfare
payments by the government to support those unable to provide for themselves
business competition
firms attract customers with better prices and or services
monopoly
one firm has power over the price and or quantity of a good/service
merger
two or more firms join together
takeover
one firm buys out another
public goods
product/service provided by the government because firms can't easily make a profit from
selling them
consumer guarantees act
law protecting consumers rights over the price and quality of household goods/services
fair trading act
law protecting consumers rights over misleading conduct false representation and unfair
selling practices
merit goods
goods/services the government considers are beneficial to us
subsidy
payment by government to consumer/producer to encourage use
demerit goods
goods/services the government considers are harmful to us
indirect tax
payment to government by consumer/producer to discourage use
exchange rate
the value of one currency in terms of another
appreciation
an increase in the value of the dollar
depreciation
a decrease in the value of the dollar