ECONOMICS TERMINOLOGIES

3. a sustained fall in the price level
5. the tendency for people who are insured or otherwise protected to take greater risks
8. the price of one currency against a basket of currencies
9. confusion over relative prices caused by inflation
11. used in the context of international trade, a situation where a country can produce a product at a lower opportunity cost than another country
12. a fall in the inflation rate
14. industries involved in providing knowledge-based services.
16. a low rate of inflation
17. someone who does not pay to use a public good
19. Adam Smith’s criteria for a ‘good’ tax
21. the setting up of production units or the purchase of existing production units in other countries.
24. non-cash assets that can be quickly turned into cash
25. a tax that is charged as a given percentage of the price

1. fluctuations in economic activity over a period of years.
2. the income of people and fi rms being pushed into higher tax brackets as a result of infl ation.
4. an accumulated stock of assets
6. an increase in the international price of a currency caused by market forces
7. the automatic way in which the market allows the preferences of consumers to be made known to producers.
10. the extent to which the tax burden is borne by the producer or the consumer or both
13. used in the context of international trade, a situation where, for a given set of resources, one country can produce more of a particular product than another country
15. the total spending on an economy’s goods and services at a given price level in a given time period
18. a fall in the exchange rate causing an increase in a current account defi cit before it reduces it due to the time it takes for demand to respond.
20. flows of money moved around the world to take advantage of changes in interest rates and exchangerates
22. within the balance of payments, a record of the trade in goods, trade in services, investment income and current transfers.
23. a ban on imports and/or exports