Economics: Vocabulary
Major concepts and definitions:
- Barter – to trade by exchange of commodities rather than by the use of money; to exchange in trade, as one commodity for another; trade; to bargain away unwisely or dishonorably.
- Budget – an estimate, often itemized, of expected income and expense for a given period in the future; a plan of operations based on such an estimate; an itemized allotment of funds, time, etc., for a given period; the total sum of money set aside or needed for a purpose.
- Buyer – a person who buys; purchaser; a purchasing agent, as for a department or chain store.
- Capital resource – goods produced and used to make other goods and services. Basic categories of capital resources include tools, equipment, buildings, and machinery. (http://www.kidseconposters.com/posters/the-basics/capital-resources/)
- Competition – the act of competing; rivalry for supremacy, a prize, etc.; the rivalry offered by a competitor; rivalry between two or more persons or groups for an object desired in common, usually resulting in a victor and a loser but not necessarily involving the destruction of the latter; the struggle among organisms, both of the same and of different species, for food, space, and other vital requirements.
- Consumer Price Index – an index of the changes in the cost of goods and services to a typical consumer, based on the costs of the same goods and services at a base period (CPI).
- Consumption – the act of eating or drinking something; the use of something (such as fuel); use by a particular group of people; the utilization of economic goods in the satisfaction of wants or in the process of production resulting chiefly in their destruction, deterioration, or transformation. (http://www.merriam-webster.com/dictionary/consumption)
- Cost – the price paid to acquire, produce, accomplish, or maintain anything; an outlay or expenditure of money, time, labor, trouble, etc.; a sacrifice, loss, or penalty.
- Deflation – a fall in the general price level or a contraction of credit and available money.
- Depression – a period during which business, employment, and stock-market values decline severely or remain at a very low level of activity.
- Distribution of wealth – a comparison of the wealth of various members or groups in a society. It differs from the distribution of income in that it looks at the distribution of ownership of the assets in a society, rather than the current income of members of that society. (https://en.wikipedia.org/wiki/Distribution_of_wealth)
- Division of labor – Narrow specialization of tasks within a production process so that each worker can become a specialist in doing one thing, especially on an assembly line. In traditional industries (see sunset industries), division of labor is a major motive force for economic-growth. However, in the era of mass customization (which requires multiple skills and very short machine change-over time), division of labor has become much more flexible. (http://www.businessdictionary.com/definition/division-of-labor.html)
- Economics – the science that deals with the production, distribution, and consumption of goods and services, or the material welfare of humankind.
- Economic interdependence – a consequence of specialization, or the division of labor, and is almost universal. The participants in an economic system are dependent on others for the products they cannot produce efficiently for themselves. (https://en.wikipedia.org/wiki/Economic_interdependence)
- Exchange – to give up (something) for something else; part with for some equivalent; change for another; to replace (returned merchandise) with an equivalent or something else.
- Federal Reserve System – a U.S. federal banking system that is under the control of a central board of governors (Federal Reserve Board) with a central bank (Federal Reserve Bank) in each of 12 districts and that has wide powers in controlling credit and the flow of money as well as in performing other functions, as regulating and supervising its member banks.
- Goods – profit or advantage; worth; benefit; possessions, especially movable effects or personal property; articles of trade; wares; merchandise; of high quality; excellent.
- Gross National Product – the total monetary value of all final goods and services produced in a country during one year (GNP).
- Human resource – any person and their particular abilities and skills; the concept of people and their potential as a resource.
- Inflation – a persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency.
- Labor force – work force; (in the U.S.) the body of people who are at least 14 years old and are either employed or available for employment.
- Market – an open place or a covered building where buyers and sellers convene for the sale of goods; a marketplace; a store for the sale of food; a meeting of people for selling and buying; the assemblage of people at such a meeting.
- Minimum wage – the lowest wage payable to employees in general or to designated employees as fixed by law or by union agreement.
- Money – any circulating medium of exchange, including coins, paper money, and demand deposits; gold, silver, or other metal in pieces of convenient form stamped by public authority and issued as a medium of exchange and measure of value.
- National debt – the financial obligations of a national government resulting from deficit spending.
- Natural resource – the natural wealth of a country, consisting of land, forests, mineral deposits, water, etc.
- Need – a requirement, necessary duty, or obligation; a lack of something wanted or deemed necessary; urgent want, as of something requisite.
- Opportunity cost – the money or other benefits lost when pursuing a particular course of action instead of a mutually-exclusive alternative.
- Price- the sum or amount of money or its equivalent for which anything is bought, sold, or offered for sale; the sum of money, or other consideration, for which a person's support, consent, etc., may be obtained, especially in cases involving sacrifice of integrity.
- Private goods – rival and excludable; "an item that yields positive benefits to people" that is excludable, i.e. its owners can exercise private property rights, preventing those who have not paid for it from using the good or consuming its benefits. (https://en.wikipedia.org/wiki/Private_good)
- Production – the action of making or manufacturing from components or raw materials, or the process of being so manufactured. (https://en.wikipedia.org/wiki/Production)
- Property – that which a person owns; the possession or possessions of a particular owner; goods, land, etc., considered as possessions; ownership; right of possession, enjoyment, or disposal of anything, especially of something tangible; a piece of land or real estate.
- Public goods – non rival and non-excludable. The non-rival part of this definition means that my consumption does not affect your consumption of a good; even those who do not explicitly (actually) pay for the good can benefit from the good. (http://www.econport.org/content/handbook/Market-Failure/Public-Goods/PRIV-V-PUB.html)
- Reasons governments levy taxes – To raise revenue to finance government spending; Managing aggregate demand - to help meet the government’s economic objectives; Changing the distribution of income and wealth; Market failure and environmental targets – taxes may help correct market failures (e.g. pollution). (http://www.tutor2u.net/business/gcse/external_environment_economic_govt_taxation.html)
- Recession – a period of an economic contraction, sometimes limited in scope or duration; the act of receding or withdrawing; a receding part of a wall, building, etc; a withdrawing procession, as at the end of a religious service.
- Scarcity – insufficiency or shortness of supply; dearth; rarity; infrequency.
- Seller – a person who sells; salesperson or vender; an article considered with reference to its sales.
- Services – employment in any duties or work for a person, organization, government, etc; an act of helpful activity; help; aid; the organized system of apparatus, appliances, employees, etc., for supplying some accommodation required by the public.
- Supply and demand – an economic model of price determination in a market. It concludes that in a competitive market, the unit price for a particular good, or other traded item such as labor or liquid financial assets, will vary until it settles at a point where the quantity demanded (at the current price) will equal the quantity supplied (at the current price), resulting in an economic equilibrium for price and quantity transacted. (https://en.wikipedia.org/wiki/Supply_and_demand)
- Tax – a sum of money demanded by a government for its support or for specific facilities or services, levied upon incomes, property, sales, etc; a burdensome charge, obligation, duty, or demand.
- Trade – the act or process of buying, selling, or exchanging commodities, at either wholesale or retail, within a country or between countries; the act of buying, selling, or exchanging stocks, bonds, or currency; a purchase or sale; business deal or transaction; an exchange of items, usually without payment of money.
- Trade route – any route usually taken by merchant ships, caravans, etc.
- Unemployment – the state of being unemployed, especially involuntarily; the number of persons who are unemployed.
- Want – to feel a need or a desire for; wish for; to wish, need, crave, demand, or desire (often followed by an infinitive).
- Bank – an institution for receiving, lending, exchanging, and safeguarding money and, in some cases, issuing notes and transacting other financial business; a sum of money, especially as a fund for use in business.
- Corporation – an association of individuals, created by law or under authority of law, having a continuous existence independent of the existences of its members, and powers and liabilities distinct from those of its members; any group of persons united or regarded as united in one body.
- Credit – the trust which allows one party to provide money or resources to another party where that second party does not reimburse the first party immediately (thereby generating a debt), but instead arranges either to repay or return those resources (or other materials of equal value) at a later date. (https://en.wikipedia.org/wiki/Credit_(finance))
- Insurance – the equitable transfer of the risk of a loss, from one entity to another in exchange for money. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. (https://en.wikipedia.org/wiki/Insurance)
- Labor union – an organization of wage earners or salaried employees for mutual aid and protection and for dealing collectively with employers; trade union.
- Nonprofit institution – an organization that uses its surplus revenues to further achieve its purpose or mission, rather than distributing its surplus income to the organization's directors (or equivalents) as profit or dividends. (https://en.wikipedia.org/wiki/Nonprofit_organization)
- Stock markets – a particular market where stocks and bonds are traded; stock exchange; the market for stocks throughout a nation.
- Capitalism – an economic system in which investment in and ownership of the means of production, distribution, and exchange of wealth is made and maintained chiefly by private individuals or corporations, especially as contrasted to cooperatively or state-owned means of wealth.
- Command economy – A system where the government, rather than the free market, determines what goods should be produced, how much should be produced and the price at which the goods will be offered for sale. The command economy is a key feature of any communist society. (http://www.investopedia.com/terms/c/command-economy.asp)
- Communism – a theory or system of social organization based on the holding of all property in common, actual ownership being ascribed to the community as a whole or to the state.
- Free-market economy – a market economy system in which the prices for goods and services are set freely by consent between vendors and consumers, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority.
- Socialism – a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole.
- Traditional economics – an original economic system in which traditions, customs, and beliefs shape the goods and the services the economy produces, as well as the rules and manner of their distribution. (https://en.wikipedia.org/wiki/Traditional_economy)
- Currency – something that is used as a medium of exchange; money.
- Economic sanctions – domestic penalties applied unilaterally by one country (or multilaterally, by a group of countries) on another country (or group of countries). Economic sanctions may include various forms of trade barriers and restrictions on financial transactions. (https://en.wikipedia.org/wiki/Economic_sanctions)
- Exchange rates – the ratio at which a unit of the currency of one country can be exchanged for that of another country.
- Exports – to ship (commodities) to other countries or places for sale, exchange, etc; to send or transmit (ideas, institutions, etc.) to another place, especially to another country.
- Free trade – trade between countries, free from governmental restrictions or duties; international trade free from protective duties and subject only to such tariffs as are needed for revenue; the system, principles, or maintenance of such trade.
- Imports – to bring in (merchandise, commodities, workers, etc.) from a foreign country for use, sale, processing, re-export, or services; to bring or introduce from one use, connection, or relation into another.
- Tariffs – an official list or table showing the duties or customs imposed by a government on imports or exports; the schedule or system of duties so imposed; any duty or rate of duty in such a list or schedule.
- Quotas – the share or proportional part of a total that is required from, or is due or belongs to, a particular district, state, person, group, etc; a proportional part or share of a fixed total amount or quantity.
All definitions found from www.dictionary.com unless stated otherwise.