MacroEcon Prelims

Trade policy

Policies that regulate imports and exports

Imports

Outflow from the circular flow that goes to the rest of the world

Capital

A warehouse building is an example of a

Algebra

Branch of Mathematics used in Economics to explain two or more variables

Command

Communism is an example of this type of economic system

Interest income

Money income received from a productive capital resource

Investment

Inflow to the circular flow that came from banks

Microeconomics

Study of consumers', producers' and workers' behavior

Labor

Manpower used in production

Government expenditures

Inflow to the circular flow that came from the government

Resource market

Market wherein the households are the sellers and the firms are the buyers

Econometrics

Economic tool used to test the validity of the hypothesis

Salary wages

Money income received from a productive labor resource

Profit

Inflow to the circular flow that came from the rest of the world exports used in production

Allocative efficiency

Producing what the society needs

Logic

Economic tool used to generalize and make conclusions

Monetary

Policies that regulate savings and investments

Full employment

Utilization of all available resources

Empirical Verification

Testing the validity of the hypothesis

Tax

Outflow from the circular flow that goes to the government

Econometrics

Anything that is measured in a specific moment in time

Service

Intangible things that satisfy needs and wants

Productive Efficiency

Producing at the least possible cost

Macroeconomics

Money, inflation and taxes are discussed in this field of Economics

Full production

Producing the right goods in the right way

Profit

Money income received for the entrepreneurial skill

Capital Resource

Man made goods used in production

Savings

Outflow from the circular flow that goes to the banks

Algebra

Branch of Mathematics used in Economics to explain two or more variables

Fiscal

Policies that regulate taxes and government spending

Normative Economics

Study of things as they ought to be; based on value judgements, culture and religion

Traditional economy

Subsistence economy is an example of a

Market economy

The quantity of goods produced is based on the buyers and the sellers

Stock Variable

Inevitable in a market economy

Product Market

Market wherein the producers are the sellers, and the households are the buyers

Assumptions

Underpins theories and laws, e.g. "ceteris paribus"

Inductive

Fallacy-prone reasoning

Land

Minerals found in caves are classified as ___ resources

Medium of exchange

Money is

Rent

Money income received from a productive land resource

Entrepreneur

The one responsible to put all factors of production together

John Maynard Keynes

Father of Macroeconomics

Invisible Hand

The theory that is the framework of a market economy

Positive Economics

Study of things as they are; factual basis of things

Adam Smith

Father of Economics

Factors of Production

Resources and Inputs

Goods

Tangible things that satisfy needs and wants