Econ Final 2nd Part
Terms
undefined, object
copy deck
- the theory that education increases productivity and results in higher wages
- learning effect
- an unofficial, invisible barrier that prevents women and minorities from advancing in businesses dominated by white men
- glass ceiling
- it produces neither an excess supply of workers nor an excess demand for workers in the labor market
- equilibrium wage
- the value of output
- productivity
- someone in a professional or clerical job who usually earns a salary
- white-collar worker
- labor that requires minimal specialized skills and education
- semi-skilled labor
- the value of a foreign nation's currency on terms of the home nation's currency
- exchange rate
- a limit on the amount of a good that can be imported
- import quota
- the concentration of the productive efforts of individuals and firms on a limited number of activities
- specialization
- the ability to produce a product mmost efficiently given all the other products that could be produced
- comparative advantage
- a tax on imported goods
- tariff
- the result of a nation exporting more than it imports
- trade surplus
- the result of a country importing more than it exports
- trade deficit
- created by Congress to help protect investors by regulating stock transactions
- SEC
- price per share of stock divided by earnings per share for a 12 month period
- PE ratio
- change in the price of a security from the closing price on one day to the closing price on the next trading day
- net change
- well-established company with good earnings and regular stock dividends
- blue chip
- stock with a claim on the company's earnings before payment can be made on common stock
- preferred stock
- an index of stocks representing about 70 percent of the total market value of American stocks
- S & P 500
- profit or loss from selling services
- Capital gain/loss
- a broker's basic fee for purchasing or selling securities
- commission
- an electronic stock market; provides brokers and dealers with price quotations on securities traded over the counter
- NASDAQ
- an index, or statistical average, based on the market price of 30 leading companies listed on the New York Stock Exchange
- Dow Jones Industrial Average
- a declining market
- bear market
- important facts about plans or conditions of a corporation that have not been released to the public
- insider information
- World's largest securities market. Only stocks with major corporations that have met the exchange's requirements for financial solidity are listed.
- New York Stock Exchange
- a payment to stockholders from the corporation's earnings
- dividends
- the act of redirecting resources from being consumed today so that they may create benefits in the furture; the use of assets to earn income or profit
- investment
- the system that allows the transfer of money between savers and borrowers
- financial system
- claim on the property or income of a borrower
- financial asset
- institution that helps channel funds from savers to borrowers
- financial intermediary
- fund that pools the savings of many individuals and invests this money in a variety of stocks, bonds, and other financial assets
- mutual fund
- spreading out investments to reduce risk
- diversification
- a collection of financial assets
- portfolio
- an investment report to potential investors
- prospectus
- the money an investor receives above and beyond the sum of the money initially invested
- coupon rate
- the time at which payment to a bondholder is due
- maturity
- the annual rate of return on a bond if the bond were held to maturity
- yield
- low-denomination bond issued by the US government
- savings bond
- a bond issued by a state or local government or municipality to finance such improvements as highways, state buildings, libraries, parks, and schools
- municipal bond
- a bond that a corporation issues to rise money to expand its business
- corporate bond
- an independent agency of the government that regulates financial markets and investment companies
- Securities and Exchange Commission
- a lower-rated, potentially higher-paying bond
- junk bond
- market in which money is lent for periods longer than a year
- capital market
- market in which money is lent for periods of less than a year
- money market
- market for selling financial assets that can only be redeemed by the original holder
- primary market
- market for reselling financial assets
- secondary market
- portion of a stock
- share
- claims of ownership in a corporation
- equities
- the difference between a higher selling price and a lower purchase price, resulting in financial gain for the seller
- capital gain
- the difference between a lower selling price and a higher purchase price resulting in a financial loss to the seller
- capital loss
- the division of a single share of stock into more than one share
- stock split
- s person who links buyers and sellers of stock
- stockbroker
- a business that specializes in trading stock
- brokerage frim
- a market for buying and selling stock
- stock exchange
- an electronic marketplace for stocks and bonds
- OTC market
- the option to sell shares of stock at a specified time in the future
- put option
- the practice of making high-risk investments with borrowed money in hopes of getting a big return
- speculation
- a system that collects macroeconomic statistics on production, income, investment, and savings
- national income accounting
- goods used in the production of final goods
- intermediate goods
- goods that last for a relatively long time, such as refrigerators, cars, and DVD players
- durable goods
- goods that last for a short period of time such as food, light bulbs, and sneakers
- nondurable goods
- GDP measured in current prices
- nominal GDP
- GDP expressed in constant, or unchanging, prices
- real GDP
- the annual income earned by US-owned firms and US citizens
- gross national product
- the loss of the value of capital equipment that results from normal wear and tear
- depreciation
- the average ofa ll prices in the economy
- price level
- the total amount of goods and services in the economy available at all possible price levels
- aggregate supply
- the amount of goods and services in the economy that will be purchased as all possible prices
- aggregate demand
- unemployment that occurs when people take time to find a job
- frictional unemployment
- unemployment that occurs as a result of harvest schedules or vacations, or when industries slow or shut down for a season
- seasonal unemployment
- unemployment that occurs when workers' skills do not match the jobs that are available
- structural unemployment
- unemployment that rises during economic downturns and falls when the economy improves
- cyclical unemployment
- an official count of the population
- census
- the percentage of the nation's labor force that is unemployed
- unemployment rate
- the level of employment reached when there is no cyclical unemployment
- full employment
- working at a job for which one is over-qualified, or working part-time when full-time work is desired
- underemployed
- a person who wants a job but has given up looking
- discouraged worker
- a general increase in prices
- inflation
- a measurement that shows how the average price of a standard group of goods changes over time
- price index
- a price index determined by measuring the price of a standard group of goods meant to represent the "market basket" of a typical urban consumer
- Consumer Price Index
- a representative collection of goods and services
- market basket
- the percentage rate of change in price level over time
- inflation rate
- the rate of inflation excluding the effects of food and energy prices
- core inflation rate
- inflation that is out of control
- hyperinflation
- theory that too much money in the economy causes inflation
- quantity theory
- theory that inflation occurs when demand for goods and services exceeds existing supplies
- demand-pull theory
- theory that inflation occurs when producers raise prices in order to meet increased costs
- cost-push theory
- the process by which rising wages cause higher prices, and higher prices cause higher wages
- wage-price spiral
- income that does not increase even when prices go up
- fixed income
- a sustained drop in the price level
- deflation
- the percentage of people who live in households with income below the official poverty line
- poverty rate
- how the nation's total income is distributed among its population
- income distribution
- government-issued coupons that recipients exhange for food
- food stamps
- the curve that illustrates the income distribution
- Lorenz Curve
- area where companies can locate free of certain local, state, and federal taxes and restrictions
- enterprise zone
- federal funds given to the states in lump sums
- block grant
- a program requiring work in exchcange for temporary assistance
- workfare