Business cycle
The business cycle tracks the size of the economy as it increases and decreases and goes through four phases – growth, boom decline and slump
Economy
Everything which is produced and consumed within a country
Globalisation
Increased interconnectedness and worldwide movement of goods, services, capital and people
Government Spending
Government investment on infrastructure or spending on welfare payments
Gross Domestic Product
Gross Domestic Product measures the size of the economy. Calculated by adding up the value of all the goods and services produced in one country in on year
Inflation
Prices and salaries rise so the value of money – what you can buy - decreases
Quotas
A limit on imports
Recession
Economy is decreasing in size
Business ethics
“Doing the right thing”. Basing business decisions on what is morally right
External benefits
The positive impact of business activity which doesn’t benefit the business but positively affects the rest of society
External costs
The costs of business activity which aren’t paid by the business but by society
Multinational corporations (MNC)
Businesses that sell goods/services or have production in more than one country
Pressure Groups
Group that tries to influence business or consumer activity in the interest of a particular cause
Repatriating profits
Taking profits earned in a foreign market and transferring to the home country of the business
Sustainable development
Achieving development (growth) without negatively impacting the environment
Currency appreciation
Value of a currency rises
Currency depreciation
Value of a currency falls
Exchange rate
The price of one currency for another, for example 1 euro = $2
Interest Rates
The cost of borrowing money. Lower interest rates means higher spending and greater economic activity
Tariffs
A tax on imports