Unit 6 Vocab Test

Productivity

The value of a particular product compared to the amount of labor needed to make it.

Gross Domestic Product (GDP)

The value of the total output of goods and services produced in a country in a given time period (normally one year)

Gross National Income (GNI)

The value of the output of a goods and services produced in a country in a year, including money that leaves and enters the country.

Purchasing power parity (PPP)

The amount of money needed in one country to purchase the same goods and serviced in another country; it adjusts income figures to account for differences among countries in the cost of goods

Maquiladora

Factories in Mexico near the US boarder, and built by US companies, in order to take advantage of the lower labor costs

Outsourcing

A decision of a corporation to turn over much of the production process to independent suppliers.

* Ex. car engines are outsourced from a supplier from out of state

Post-Fordist production

Adoption by companies of flexible work rules

Ex. allocating workers to teams that complete a variety of tasks

Right-to-work law

A U.S. law that prevents a union and a company from negotiating a contract that requires workers to join the union as a condition of employment

Site factors

location factors related to the costs of factors of production inside a plant

* land
* labor
* capital

Situation Factors

Location factors related to the transportation of materials into and from a factory

* Proximity to input (Bulk-reducing)
* Proximity to market (Bulk-gaining)

Vertical Integration

An approach typical of traditional mass production in which company controls all phases of a highly complex production process

Foreign Direct Investment (FDI)

Investment made by a foreign company in the economy of another country

Millennium Development Goals

Eight International development goals that all members of the UN have agreed to achieve by 2015

Uneven Development

Development of core regions at the expense of those on the periphery

* Benefits MDC’s
* LDC’s struggle

Value added

The gross value of a product minus the costs of raw materials and energy

Housing bubble

A rapid increase in the value of houses followed by a sharp decline in their value

Primary Sector

The portion of the economy concerned with the **direct extraction of materials from earth’s surface, generally through agriculture,** although sometimes by mining, fishing, + forestry

Secondary Sector

The portion of economy concerned with **manufacturing useful products** through processing, transforming, and assembling raw materials

Tertiary Sector

The portion of economy concerned with **transportation, communications, and utilities,** sometimes extended to the provision of all goods and services to people in exchange for payment

Microfinance

Provision of small loans and other financial services to individuals and small businesses in developing countries (LDC’s)