Bus.1 -3 vocab

  1. What is absolute advantage?
    The advantage that exists when a country has a monopoly on producing a specific product or is able to produce it more efficiently than all other countries.
  2. What is it, to have a balance of payments?
    The difference between money coming into a country (from exports) and money leaving the country (for im -ports) plus money flows from other factors such as tourism, foreign aid, military expenditures.
  3. What is the brain drain?
    The loss of the best and brightest people to other countries.
  4. What is a balance of trade?
    The total value of a nation’s exports compared to its imports over a particular period.
  5. What is business?
    Any activity that seeks to provide goods and services to others while operating at a profit.
  6. What are business cycles?
    The periodic rises and falls that occur in economies over time.
  7. What is a business environment?
    The surrounding factors that either help or hinder the development of businesses.
  8. What is capitalism?
    An economic system in which all or most of the factors of production and distribution are privately owned and operated for profit.
  9. What is communism?
    An economic and political system in which the government makes almost all economic decisions and owns almost all the major factors of production.
  10. What are command economies?
    Economic systems in which the government largely decides what goods and services will be produced, who will get them, and how the economy will grow.
  11. What is climate change?
    The movement of the temperature of the planet up or down over time.
  12. What is the consumer price index (CPI)?
    Monthly statistics that measure the pace of inflation or deflation.
  13. What is contract manufacturing?
    A foreign country’s production of private-label goods to which a domestic company then attaches its brand name or trademark; part of the broad category of outsourcing.
  14. What is the comparitive advantage theory?
    A theory that states that a country should sell to other countries those products that it produces most effectively and efficiently, and buy from other countries those products that it cannot produce as effectively or efficiently.
  15. What is a common market?
    A regional group of countries that have a common external tariff, no internal tariffs, and a coordination of laws to facilitate exchange; also called a trading bloc. An example is the European Union.
  16. What is countertrading?
    A complex form of bartering in which several countries may be involved, each trading goods for goods or services for services.
  17. What is deflation?
    A situation in which prices are declining.
  18. What is demand?
    The quantity of products that people are willing to buy at different prices at a specific time.
  19. What is a database?
    An electronic storage file for information. data processing
  20. What is a demography?
    The statistical study of the human population with regard to its size, density, and other characteristics such as age, race, gender, and income.
  21. What is a depression?
    A severe recession, usually accompanied by deflation.
  22. What is devaluation?
    Lowering the value of a nation’s currency relative to other currencies.
  23. What is disinflation?
    A situation in which price increases are slowing (the inflation rate is declining).
  24. What is dumping?
    Selling products in a foreign country at lower prices than those charged in the producing country.
  25. What is e-commerce?
    The buying and selling of goods over the Internet.
  26. What is a embargo?
    A complete ban on the import or export of a certain product, or the stopping of all trade with a particular country.
  27. What are economics?
    The study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals.
  28. What is a entrepreneur?
    A person who risks time and money to start and manage a business.
  29. What is empowerment?
    Giving frontline workers the responsibility, authority, freedom, training, and equipment they need to respond quickly to customer requests.
  30. What si the exchange rate?
    The value of one nation’s currency relative to the currencies of other countries.
  31. What is exporting?
    Selling products to another country.
  32. What is fiscal policy?
    The federal government’s efforts to keep the economy stable by increasing or decreasing taxes or government spending.
  33. What are factors of production?
    The resources used to create wealth: land, labor, capital, entrepreneurship, and knowledge.
  34. What is foreign direct investment (FDI)?
    The buying of permanent property and businesses in foreign nations.
  35. What is a foreign subsidiary?
    A company owned in a foreign country by another company, called the parent company.
  36. What is free trade?
    The movement of goods and services among nations without political or economic barriers.
  37. What are goods?
    Tangible products such as computers, food, clothing, cars, and appliances.
  38. What are free-market economies?
    Economic systems in which the market largely determines what goods and services get produced, who gets them, and how the economy grows.
  39. What is General Agreement on Tariffs and Trade (GATT)?
    A 1948 agreement that established an international forum for negotiating mutual reductions in trade restrictions.
  40. What is greening?
    The trend toward saving energy and producing products that cause less harm to the environment.
  41. What is the gross domestic product (GDP)?
    The total value of final goods and services produced in a country in a given year.
  42. What is identity theft?
    The obtaining of individuals’ personal information, such as Social Security and credit card numbers, for illegal purposes.
  43. What is importing?
    Buying products from another country.
  44. What is a import quota?
    A limit on the number of products in certain categories that a nation can import.
  45. What is inflation?
    A general rise in the prices of goods and services over time.
  46. What is the invisible hand?
    A phrase coined by Adam Smith to describe the process that turns selfdirected gain into social and economic benefits for all.
  47. What is joint venture?
    A partnership in which two or more companies (often from different countries) join to undertake a major project.
  48. What is licensing?
    A global strategy in which a firm (the licensor) allows a foreign company (the licensee) to produce its product in exchange for a fee (a royalty).
  49. What is the Keynesian economic theory?
    The theory that a government policy of increasing spending and cutting taxes could stimulate the economy in a recession.
  50. What is macroeconomics?
    The part of economics study that looks at the operation of a nation’s economy as a whole.
  51. What is market price?
    The price determined by supply and demand.
  52. What is microeconomics?
    The part of economics study that looks at the behavior of people and organizations in particular markets.
  53. What are mixed economies?
    Economic systems in which some allocation of resources is made by the market and some by the government.
  54. What is monetary policy?
    The management of the money supply and interest rates by the Federal Reserve Bank.
  55. What is a monopolistic competition?
    The degree of competition in which a large number of sellers produce very similar products that buyers nevertheless perceive as different.
  56. What is a monopoly?
    A degree of competition in which only one seller controls the total supply of a product or service, and sets the price.
  57. What is a multinational corporation?
    An organization that manufactures and markets products in many different countries and has multinational stock ownership and multinational management.
  58. What is the North American Free Trade Agreement (NAFTA)?
    Agreement that created a free-trade area among the United States, Canada, and Mexico.
  59. What is the national debt?
    The sum of government deficits over time.
  60. What is a oligopoly?
    A degree of competition in which just a few sellers dominate the market.
  61. What is perfect competition?
    The degree of competition in which there are many sellers in a market and none is large enough to dictate the price of a product.
  62. What is the producer price index (PPI)?
    An index that measures prices at the wholesale level.
  63. What is a recession?
    Two or more consecutive quarters of decline in the GDP.
  64. What is resource development?
    The study of how to increase resources and to create the conditions that will make better use of those resources.
  65. What is socialism?
    An economic system based on the premise that some, if not most, basic businesses should be owned by the government so that profits can be more evenly distributed among the people.
  66. What is are sovereign wealth funds (SWFs)?
    Investment funds controlled by governments holding large stakes in foreign companies.
  67. What is stagflation?
    A situation when the economy is slowing but prices are going up anyhow.
  68. What is a strategic alliance?
    A long-term partnership between two or more companies established to help each company build competitive market advantages.
  69. What is a supply?
    The quantity of products that manufacturers or owners are willing to sell at different prices at a specific time.
  70. What is a tariff?
    A tax imposed on imports.
  71. What is a trade deficit?
    An unfavorable balance of trade; occurs when the value of a country’s imports exceeds that of its exports.
  72. What is trade protectionism?
    The use of government regulations to limit the import of goods and services.
  73. What is a trade surplus?
    A favorable balance of trade; occurs when the value of a country’s exports exceeds that of its imports.
  74. What si the World Trade Organization (WTO)?
    The international organization that replaced the General Agreement on Tariffs and Trade, and was assigned the duty to mediate trade disputes among nations.
Card Set
Bus.1 -3 vocab
Bus.1 -3 vocab