Unit 1
What is the definition of economics?
What does GDP stand for?
Gross Domestic Product
monetary policy
a set of actions to control a nation's overall money supply and achieve economic growth.
Absolute advantage
the ability for a country to produce a good at a lower cost per unit
globalization
global integration of the economies of the world
What is scarcity?
Unlimited wants meet limited resources.
period of expansion
decreasing unemployment rate, gdp is increasing
fiscal policy
the use of government spending and taxation to influence the economy.
comparative advantage
the ability of a country to produce a good or service at a lower opportunity cost.
interdependence
mutual dependence of the participants in an economic system who trade in order to obtain the products they cannot produce efficiently for themselves
4 factors of production
Land, Labor, Capital and Entrepreneurs.
period of contraction
unemployment rate is increasing, gdp in decreasing
3 tools the govt uses
taxes, spending, and borrowing
trade balance
the difference between the value of a country's imports vs exports for a given period
tariffs
tax imposed on imports
Types of economics systems:
traditional economy, command economy, market economy, mixed economy.
speculation
the act of investing in opportunities with a high risk of loss, but also with the potential for significant financial gain
surplus
Fed revenues are higher than government spending
protectionism
practice of shielding a country's domestic industries from foreign competition by taxing imports
quotas
limits on the amount of goods imported
Capitalism vs Communism
what type of mandate does the FED and Congress has
Dual mandate
deficit
spending is higher than revenue
free trade
trading without restrictions
USMCA
United States, Mexico, Canada Agreement