Glossary of Economic Terms


antitrust laws - Anti trust laws are laws that prohibit companies and businesses from monopolizing an entire economic market.

average costs - Average cost is the total cost for all products bought and/or made, divided by the number of products.

average variable costs - Also known as AVC, average variable costs is the total cost that a company can vary, divided by the total output of products.

capital gain - Capital gain is the amount of money a product’s selling price exceeds it’s actual purchase price.

certificate of deposit - A certificate of deposit, also known as a CD, is a savings fund purchased through a bank. The certificate means you have deposited a sum of money for a specific amount of time. You earn interest on the CDs when they are left untouched. The bank sets standards of a minimum deposits and specified amounts of time.

closed economy - A closed economy means a country has no economic dealings with any other country, including imports and/or exports.

consumer price index - Also known as the cost of living index, the consumer price index measures the change in cost of fixed products and services.

debt - Debt is the state of owing money to someone or something.

deficit spending - Deficit spending is the amount of money a person or company spends in excess of their income over a measured amount of time.

deflation - Deflation is the decrease of price levels in an economy. Deflation usually occur when an economy is lacking a money supply, or the economy is failing.

devaluation - Devaluation is a decrease in value of a specific country’s currency.

Discount Codes - codes entered at the time of purchase in which the comsumer is awarded a discount on the item.

dividends - Dividends are payments that a business or company makes to its stock holders and shareholders.

equity capital - Equity capital is the money invested into a business by the owners or stockholders.

exports - Exports are the goods or services that are sold by one country to another.

fiscal policies - Fiscal policies are the regulations, plans and laws implemented by the government on all things related to the economy and spending.

fixed costs - Fixed costs are costs that do not increase or decrease, regardless of other factors such as sales or production.

gross national products (GNP) - Gross national product refers to total value of goods and services produced within one economy, plus the economy’s imports, minus the economy’s exports.

human capital - Human capital is the value of an employee based on the skills, knowledge and training they have received through the job.

imports - Imports are goods and services a country’s economy sells to foreign economies.

inflation rate - Inflation rate is the measured cost of price increase in goods and services. The inflation rate is usually measured by year.

investment - Investment is the act of purchasing something of value, with hopes of earning money in the future.

marginal cost - Marginal cost is the fluctuation of cost resulting from the change of production by one unit.

market economy - Market economy is an economy that bases it’s exchange on supplies and demands. A market economy is also known as a free economy, and is free from governmental interference.

monopoly - A monopoly is when a business or company has complete control over a specific market.

overhead costs - Overhead costs are the ongoing and fixed costs of running and operating a business.

portfolio - A portfolio is multiple investments and shares owned by one person or company.

price index - The price index is the measurable change in the price of goods within a set period of time.

product liability - Product liability is a specific field of law that refers to the responsibility of the producer of a product or service to maintain responsibility for legal actions associated with said products or services.

profits - Profits are the monetary gains made by a company, after subtracting all expenses.

quotas - Quotas are a set goal, number or target range implemented by a company. Quotas usually refer to amount of sales made, products produced or money acquired.

real income - Real income is the amount of goods and services a company can purchase.

recession - A recession is a state of an economy when business activity starts to decline and eventually hits it’s lowest point.

revenues - Revenues is the total amount of money a company or business makes off of it’s goods and services during a set amount of time.

sticky wages - Sticky wages refers to the resistance to change. Sticky wages usually refers to salary wages that do not increase.

total costs - Total costs are the total amount of money spent on a specific investment, or the total amount of money spent on variable costs.

trade deficit - A trade deficit is the state of an economy that has an excess of imports over exports.

trusts - Trusts are legal agreements which gives monetary and

unemployment rate - The unemployment rate is the percentage of the work force that is not employed.

units - Units are a specific standard of measurement.

variable costs - Variable costs are the costs to run a business. These costs are not fixed and are directly related to business activity levels.

Vodafone promotional codes - a specific method to reduce a fixed price for goods.

World Trade Organization (WTO) - The World Trade Organization is the association that regulates and sets standards for the trading of goods between countries world-wide.