ECON TERMS

What does the French phrase 'Laissez faire' mean in economic terms?

'let do' or 'don't get too involved'

What does 'revenue' refer to in economics?

Money taken in; typically sourced from taxes and customs duties.

Define 'expenditures' in the context of economics.

Any money spent; it refers to the outflow of money.

What is a 'budget'?

A spending plan that outlines the government's spending priorities.

What is meant by a 'balanced budget'?

A situation where expenditures and revenues are equal.

What is 'deficit financing'?

Spending to stimulate the economy in the long term, often by going into debt.

What is 'currency'?

The type of money used in transactions.

Explain the concept of 'capitalism'.

An economic system characterized by the accumulation of wealth, where the rich get richer and the poor get poorer.

What is a 'market economy'?

An economic system where suppliers and buyers negotiate prices for products.

Explain 'supply and demand'.

A concept explaining how prices are determined based on product availability and consumer desire.

What is 'supply'?

The availability of a particular product in the market.

What does 'demand' represent?

The desire or need for a product by consumers.

What is 'The Business Cycle'?

The recurring cycle of prosperity and recession that occurs approximately every 5-6 years.

Define 'prosperity' in economic terms.

A phase where businesses are thriving and the economy is growing.

What does 'recession' indicate in the business cycle?

A decline in economic activity.

Describe the cycle of the Business Cycle using the acronym PRDRE.

Peak, Recession, Depression, Recovery, Expression.