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EPF
| Term | Definition |
|---|---|
| macroeconomics | the study of the economy as a whole, including topics such as inflation, unemployment, and economic growth |
| microeconomics | study of how a single unit makes financial decisions |
| traditional economy | based on trading goods for other goods, characterized by rudimentary technology (ex: third world countries) |
| command economy | an economic system in which the government controls a country's economy. |
| market economy | economic decisions are made by individuals or the open market. |
| mixed economy | an economy in which private enterprise exists in combination with government regulation and promotion. |
| free market | an economic system in which prices and wages are determined by unrestricted competition between businesses, without government regulation or fear of monopolies. |
| indicator | statistic about an economic activity |
| gross domestic product (GDP) | statistic about an economic activity |
| consumer price index (CPI) | a measure of the overall cost of the goods and services bought by a typical consumer |
| trade-off | the act of giving up one benefit in order to gain another, greater benefit |
| opportunity cost | the next best thing given up when a choice is made |
| equilibrium price | the price at which the quantity demanded equals the quantity supplied |
| depression | a long-term economic state characterized by unemployment and low prices and low levels of trade and investment |
| monopoly | complete control of a product or business by one person or group |
| recession | period of reduced economic activity |
| capitalism | an economic system based on private ownership of capital |
| communism | the holding of all property in common, actual ownership being ascribed to the public |
| socialism | government, owns and controls the means of production. |
| oligopoly | a market structure in which a few large firms dominate a market |
| elasticity | how a change in price affects affects quantity demanded or quantity supplied |
| related goods | complements and substitutes |
| complementary goods | products and services that are used together. When the price of one falls, the demand for the other increases (and conversely). |
| substitute goods | products or services that can be used in place of each other. When the price of one falls, the demand for the other product falls; conversely, when the price of one product rises, the demand for the other product rises. |
| elastic demand | demand in which changes in price have large effects on the amount demanded |
| inelastic demand | an increase or a decrease in price will not significantly affect demand for the product |
| elastic supply | when a small change in price causes a major change in the quantity supplied |
| inelastic supply | exists when a change in a good's price has little impact on the quantity supplied |
| fiscal policy | the use of government spending and revenue collection to influence the economy |
| stimulus | attempts to use monetary policy or fiscal policy to stimulate the economy |
| monetary policy | the setting of the money supply by policymakers in the central bank |
| inflation | a general and progressive increase in prices |
| subsidies | a sum of money granted by the government or a public body to assist an industry or business so that the price of a commodity or service may remain low or competitive. |
| bailouts | extending financial support to a company facing a potential bankruptcy |
| corporation | a company or group of people authorized to act as a single entity (legally a person) and recognized as such in law. |
| proprietorship | a business owned and run by just one person |
| revenue | income |
| progressive tax | a tax for which the percentage of income paid in taxes increases as income increases |
| appropriation | a legislative grant of money to finance a government program or agency |
| capital gains | a profit from the sale of property or of an investment. |
| excise tax | a tax on the production or sale of a good |
| estate | property, land |
| inheritance | the gain of property from a deceased relative |
| labor union | an organization of workers that tries to improve working conditions, wages, and benefits for its members |
| zone/zoning | laws or regulations that govern how real property can and cannot be used in certain geographic areas |
| eminent domain | power of a government to take private property for public use. |
| collective bargaining | process by which a union representing a group of workers negotiates with management for a contract |
| contraction | a period of economic decline marked by falling real GDP |
| expansion | a period of economic growth as measured by a rise in real GDP |
| cooperatives | a farm, business, or other organization that is owned and run jointly by its members, who share the profits or benefits. |
| securities | stocks, bonds, and mutual funds representing secured, or asset-based, claims by investors against issuers |
| commodities | a raw material or primary agricultural product that can be bought and sold, such as copper or coffee. |
| stocks | shares of ownership in a company |
| antitrust | government intervention to alter market structure or prevent abuse of market power |
| copyright | the exclusive legal right, given to an originator or an assignee to print, publish, perform, film, or record literary, artistic, or musical material, and to authorize others to do the same. |
| patent | exclusive rights over an invention |
| trademark | a brand that has exclusive legal protection for both its brand name and its design |
| mediation | a method of settling disputes outside of court |
| arbitration | settling a dispute by agreeing to accept the decision of an impartial outsider |
| regressive tax | a tax for which the percentage of income paid in taxes decreases as income increases |
| absolute advantage | the ability to produce more with a given amount of resources or time |
| comparative advantage | the ability to produce more with less of an opportunity cost |
| subsidy | a government payment that supports a business or market |
| surplus | a situation in which quantity supplied is greater than quantity demanded |
| shortage | a situation in which quantity demanded is greater than quantity supplied |
| exchange rate | the measure of how much one currency is worth in relation to another. |
| fair trade | alternative to international trade that emphasizes employees wellbeing |
| free trade | international trade free of government interference |
| economic interdependence | a reliance on others, as they rely on you, to provide goods and services to be consumed |
| embargo | an official ban on trade or other commercial activity with a particular country. |
| globalization | growth to a global or worldwide scale |
| outsourcing | a decision by a corporation to turn over much of the responsibility for production to independent suppliers. |
| protectionism | economic policy of shielding an economy from imports. |
| sanction | commercial and financial penalties applied by states or institutions against states, groups, or individuals |
| scarcity | a situation in which unlimited wants exceed the limited resources available to fulfill those wants |
| specialization | a focus on a particular activity or area |
| trade war | a cycle of increasing trade restrictions |
| variable cost | a cost that rises or falls depending on how much is produced |
| dividend | the portion of corporate profits paid out to stockholders |
| wage | an amount of money paid to an employee at a specific rate per hour worked. |
| salary | a fixed amount of money paid to an employee for each pay period. |
| gross income | the total amount of income from wages before any payroll deductions |
| net income | the difference between total revenue and total expenses when total revenue is greater |
| dependent | someone who relies on someone else for income and care |
| premium | amount you pay monthly, quarterly, semiannually or annually to purchase different types of insurance |
| equity | the value that would be returned to a company's shareholders if all of the assets were liquidated and all of the company's debts were paid off |
| collateral | something pledged as security for repayment of a loan, to be forfeited in the event of a default. |
| mortgage | a specific type of loan that is used to buy real estate |
| escrow | the deposit of funds with a neutral third party who is instructed to carry out the provisions of an agreement. |
| will | a legally enforceable declaration of how a person wishes his or her property to be distributed after death |
| estate planning | provides a clear plan for what should happen upon the death of an individual |
| deductible | a specified amount of money that the insured must pay before an insurance company will pay a claim |
| beneficiary | one who benefits from something; a person who is left money or other property in a will or the like |
| asset | anything of value that is owned |
| philanthropy | charitable donation to public causes |
| discretionary income | disposable income available for spending and saving after an individual has purchased the basic necessities of food, clothing, and shelter |
| disposable income | income remaining for a person to spend or save after all taxes have been paid |
| passive income | money earned on a regular basis with little or no effort required to maintain it |
| fixed cost | a cost that does not change, no matter how much of a good is produced |
| liability | something disadvantageous |
| revolving credit/debt | automatically renews as you pay off existing debts |
| secured credit/debt | type of card that is backed by a cash deposit from the cardholder |
| bankruptcy | a legal process to get out of debt when you can no longer make all your required payments |
| creditworthiness | a measure of your ability and willingness to repay a loan |
| overdraft | occurs when money is withdrawn from a bank account and the available balance goes below zero |
| principal | the amount of money borrowed |
| bond | a financial security that represents a promise to repay a fixed amount of funds (secure way to earn back money slowly) |
| stock | a share of ownership in a corporation. |
| diversify/diversification | to spread out the money you invest into different types of investments (ex: bonds, stocks, mutual funds) |
| brokerage | the business of bringing people together in a real estate transaction. |
| legal tender | any kind of money that a creditor must by law accept in payment for debts |
| algorithm | a methodical, logical rule or procedure that guarantees solving a particular problem. |
| endorsement | an act of giving one's public approval or support to someone or something |
| fraud/fraudulent | an intentional perversion of truth for the purpose of inducing another to surrender a legal right |
| solicit/solicitation | offering money to someone with the specific intent of inducing that person to commit a crime |
| forgery | the fraudulent making or altering of any writing in a way that changes the legal rights and liabilities of another. |
| phishing | an attack that sends an email or displays a Web announcement that falsely claims to be from a legitimate enterprise in an attempt to trick the user into surrendering private information |
| skimming | double-swiping a credit card in a legitimate terminal or covertly swiping a credit card in a small, hidden, handheld card reader that records credit card data for later use |
| malware | software that is intended to damage or disable computers and computer systems. |
| deception | purposely misleading |
| unethical | not morally correct |
| warranty | a confirmation of the quality or performance of a good or service |
| identity theft | a crime that involves someone pretending to be another person in order to steal money or obtain benefits |
Created by:
maryn.m
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