terms

Analytical or positive economics

A way of studying and understanding how the economy works using numbers, data, and math. An objective stream of economics that relies on facts or what is happening.

Bond

Issued by governments and corporations when they want to raise money.

Business Model (e.g

Describes how your business works from an economic perspective.

Chequing Account

Used to store daily spending money, designed for everyday transactions.

Collectibles

An item worth a lot more than its original selling price.

Common stock

shares of ownership in a corporation and the type of stock in which most people invest.

Compounding

process of adding interest to an initial sum of money over time.

Credit

borrow money from an organization with the agreement to pay it back later.

Economic questions

what to produce, how to produce it, and who to produce it for.

GIC

Guaranteed Investment Certificate, is a type of investment where you deposit money with a financial institution for a fixed period of time.

Interest

The price you pay to borrow money or the return earned on an investment.

Mutual Fund

when a company pools their money together to invest in different things such as stocks, bonds, and short-term debt. portfolio.

Needs and wants

Anything required for human survival is considered needs. Wants are things people would like to have or desire.

Normative or policy economics

The value of economic fairness or what the economy should be based on value judgments.

Opportunity cost

The value of the next highest valued alternative use of that resource. The cost of choosing one option over the other.

Real estate

properties like houses, apartments, and land that can be bought or sold.

RESP

Registered Education Savings Plan is a long-term savings plan to help people save for a child’s education after high school.

Risk

Defined in financial terms as the chance that an outcome or investment’s actual gains will differ from an expected outcome or return.

RRIF

An arrangement between you and a carrier (registered retirement income fund).

RRSP

Investing a retirement savings plans in Canada.

Savings Account

A basic type of financial product allowing you to deposit your money and typically earn a modest amount of interest.

Scarcity and scarce resources

The demand for a good or service is greater than the availability of the good or service

The limited availability of resources with our unlimited wants and needs. It means that there aren't enough resources to satisfy everyone's desires.

Scarcity and Choice

All choices mean that one alternative is selected over another.

TFSA

Tax-free savings account, available in Canada that provides tax benefits for saving.

Utility

A term used to determine the worth or value of a good or service, and satisfaction or happiness that individuals derive from consuming goods or services.

Expansionary policy

is like when they "expand" spending to boost the economy.

A set of economic measures taken by a government or central bank to stimulate economic growth.

Contractionary policy

is the opposite, where they "contract" spending to slow down the economy.

A monetary measure to reduce government spending or the rate of monetary expansion by a central bank.

Monetary policy

is all about the "money supply" and how the central bank controls it.

A set of actions to control a nation's overall money supply and achieve economic growth.

Bank of Canada

Canada's central bank.

Economic Sustainability

having a strong and stable economy that also takes care of the environment and society.

SWOT

Strengths, Weaknesses, Opportunities, and Threats involved in an organization, business, or a project.

Trade

The voluntary exchange of goods or services between economic industries

Global Economy

The sum of activities that take place both within a country and between different countries.

Absolute advantage

a country, producer, or company can produce a good or service more efficiently than others.

Comparative advantage

Aa country, producer, or company can produce a good or service less efficiently than others at a lower opportunity cost.

Factors of production

The resources people use to produce goods and services.

Imports

goods and services that a country buys from other countries

Exports

goods and services that a country sells to other countries

Trade surplus

where a country's exports exceed its imports.

Trade deficit

A trade deficit means imports are greater than exports.

Free trade

there are no additional taxes (called tariffs), or other trade restrictions placed on imports. countries can freely exchange goods and services without restrictions like taxes or limits

Tariffs

Taxes imposed by one country on goods or services imported from another country. a tax imposed on imported or exported goods.

Expenditure Approach

Adds up the total amount that is spent on all final goods and services in a year (GDP).

Stages of Business Cycle

Boom, Recession, Slump/Depression, & Recovery.

BITER

Buyers (# of): changes in the number of consumers;

Income: changes in consumers' income

Taste: if the preference of people changes;

Expectation: changes in what consumers expect to happen in the future;

Related Goods: compliments and substitutes.

Facts and value

Economy attempted to explain human behavior and to help in decision by using facts and values

(C) Consumption 

Used up on what household spend on all goods and services that they consume ise food, clothing gas, car etc

(G) Government 

This represents the amount of money the government spends on public services, infrastructure, healthcare, education, and other areas.

(I) Investment

Purchases by business of new capital goods used in the production process

X - M (Net Exports)

X = exports;         M = imports.

Imports must be subtracted because they do not represent Canadian

Supply

The total amount of a specific good or service available to consumers 

Demand

consumer’s desire to purchase goods and services and are willing to pay a specific price for them 

Quantity Supply

The number of goods or services that suppliers will produce and sell at a given market price. (total supply)

Quantity Demand

Total amount of a good or service that consumers demand over a given period of time (total demand)

Law of Demand

rice goes up quantity goes down, Price goes down quantity goes up

Law of Supply

Price goes up quantity goes up

Price goes down quantity goes down

Market Demand

The sum/total of all consumer demands for a particular good / service.

Law of diminishing marginal utility 

The demand curve slopes downwards due to diminishing marginal utility. The more you have of something the less satisfaction you get

Lorenz curve

A graphical representation of the distribution of income or wealth in a society.

Gini coefficient/score

A statistical measure of economic inequality in a population

Income Inequality

How unevenly income is distributed throughout a population Poverty

Poverty

Not having enough money to meet basic needs including food, clothing and shelter 

Union

An agreement between two or more nations to allow goods, services, money and workers to move over borders freely

Unemployment

Occurs when someone is willing and able to work but does not have a paid job

Underemployment

a condition in which workers are employed in less than full-time or regular jobs or insufficient jobs for their training or economic needs

The market

Any structure that allows buyers and sellers to exchange any type of goods, services and information

Price

Amount of money that a buyer gives to a seller in exchange for a good or service

Buyers and Sellers

Sellers Create supply, while buyers generate demand

Other things being equal

Ceteris paribus, meaning all other things being equal. One economic variable has on another, provided all other variables remain constant.

Demand schedule

Shows the quantity demanded of a good or service at different price levels

Supply schedule

A graph showing you how many products are demanded from customers at a specific price based on the supply curve

Demand/supply curve

Shows the quantities of a particular good or service that buyers will be willing and able to purchase at each price during a specific period

Demand Factors

Price of related goods, price of substitutes, goods and income of a consumer

Changes in quantity demanded

Change in the quantity demanded due to a price change occurs along the demand curve

Substitute goods

A product or service that consumers see as essentially the same or similar enough to another product

Profit

Money earned after taking explicit and implicit costs into account

Complementary goods

that are used together or are consumed together.

Market supply

The total amount of an item producers are willing and able to sell at different prices over a given period of time

Market Equilibrium

The state in which market supply and demand balance each other, and as a result prices become stable

Equilibrium Price

The consumer cost assigned to some product or service such that supply and demand are equal, or close to equa

Shortage

quantity demanded is greater than the quantity supplied at the market price

Surplus

supply outweighing demand

Ceiling Prices

Mandated maximum amount a seller is allowed to charge for a product or service

Price Floor

The lowest legal price that can be paid in a market for goods and services, labor, or financial capital

Labour rights

Legal rights and human rights relating to labor relations between workers and employers

Arbitration

A mechanism for resolving disputes between investors and brokers, or between brokers

Collective bargaining

A voluntary process used to determine terms and conditions of work and regulate relations between employers, workers, and their organizations, leading to the conclusion of a collective agreement

Grievance

a complaint or a feeling of injustice about something.

Lockout

The tactics of withholding employment, typically used by employers to hinder union organization or to gain leverage in labor disputes

Right to work laws

Givers the workers the freedom to choose whether or not to join a labor union in the workplace

Strike

A collective refusal by employees to work under the conditions required by employers

Walkout

The act of leaving an official meeting as a group in order to show disapproval or of leaving place of work to start a strike

Unionization rate

A percentage of total employment defined as public and private employment, not including self-employment

Negotiations

A strategic discussion between two parties to resolve an issue in a way that both find acceptable

Minimum Wage

The minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period of time

Precarious Workers

Non-standard or temporary employment that may be poorly paid, insecure, unprotected and unable to support a household

Vulnerable workers

individuals who may be at a higher risk of exploitation or mistreatment due to low income, limited education, language barriers, or immigration status

Temporary foreign workers

A transitory solution to maintain economic growth by filling excess labor demand in the presence of rather long delays for permanent immigration

Frictional unemployment

The result of workers searching for new employment or transitioning from their old jobs to new ones