Economic specific
a sustained increase in overall price level of goods and services in an economy
Inflation
the economic model that explains how prices are determined by the relationship between how much a good is available and how much consumers want it
supply and demand
something that motivates or encourages someone to take a particular action
incentive
the proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.
interest rate
a situation where people who are willing and able to work cannot find jobs
Unemployment
the value of the next best alternative that is given up when making a decision
opportunity cost
the condition of limited resources relative to unlimited wants
scarcity
an economic system in which private business operates in competition and largely free of state control.
free enterprise
the total value of all final goods and services produced within a country in a given year
Gross Domestic Product (GDP)
the ability to borrow money with the promise to repay it later, usually with interest.
credit
the amount of output produced per worker or per hour worked
productivity
interest earned on both an initial principal balance and the accumulated interest from previous periods. It acts like a "snowball effect," where interest builds upon itself to grow savings or investment faster than simple interest. It is often used in savings accounts, CDs, and can also increase debt on credit
compound interest
the process of starting and managing a business in order to make a profit while taking on financial risk
Entrepreneurship
a tax placed on imported goods
tariff
the increasing interconnectedness of economies through trade, technology, and communication
Globalization
an economic and political system in which a country's trade and industry are controlled by private owners for profit.
capitalism
actions taken by a nation's central bank to control the money supply and interest rates
Monetary Policy
government decisions about taxation and spending to influence the economy
fiscal policy
to distribute resources for a specific purpose
Allocate
a secured loan used to purchase or refinance real estate, where the property acts as collateral. If the borrower fails to make payments, the lender can foreclose on the property to recover the loan balance.
Mortgage