THE ECONOMICS A-Z (o-p-r)

Read the follwing definitions of vocabulary associated with Economics. Then try to find the Spanish word:

Output - An amount of something produced by a person, machine, factory, country, etc

Payment - Compensation, discharge or performance of an obligation, or reimbursement, by giving over something that is of satisfactory value to its recipient, such as money.

Poverty - Condition where people's basic needs for food, clothing, and shelter are not being met.

Price - The amount of money for which something is sold.

Primary market - Financial market in which newly issued securities are offered to the public.

Production - The processes and methodsemployed to transform tangibleinputs (raw materials, semifinishedgoods, or subassemblies) and intangible inputs (ideas, information, knowledge) into goods or services to be sold.

Productivity - Relative measure of the efficiency of a person, machine, factory, system, etc., in converting inputs into useful outputs. Computed by dividing average output perperiod by the total costs incurred or resources (capital, energy, material, personnel) consumed in that period, productivity is a critical determinant of cost efficiency.

Profit - Money which is earned in trade or business, especially after paying the costs of producing and selling goods and services.

Rate of interest - Alternative term for interest rate.The percentage that a bank or other financial company charges you when you borrow money, or the percentage it pays you when you keep money in an account.

Revenue - Amount generated from sale of goods or services, or any other use of capital or assets, associated with the mainoperations of firm before any costs or expenses are deducted.

Risk - Probability that an actual returnon an investment will be lower than the expected return. Financial risk is divided into the following general.

THE ECONOMICS A-Z (l-m)

Read the follwing definitions of vocabulary associated with Economics. Then try to find the Spanish word:

Labour:

One of the factors of production, it is the aggregate of all human physical and mental effort used in creation of goods and services. The size of a nation'slabor force is determined by the size of its adult population, and the extent to which the adults are either working or are prepared to offer their labor for wages. More recently, knowledge (know how) has come to be regarded as distinct from labor.

Laissez-faire:

French for, allowto pass or let go. One of the guiding principles of capitalism, this doctrineclaims that an economic system should be free from government intervention or moderation, and be driven only by the market forces. Centered on the belief (termed invisible hand by the 18th century Scottish economist Adam Smith) that human beings are naturally motivated by self-interest and, when they are not interfered-with in their economicactivities, a balanced system of production and exchange based on mutualbenefit emerges.

Land:

Primaryinput and factor of production which is not consumed but without which no production is possible. It is the resource that has no cost of production and, although its usage can be switched from a less to more profitable one, its supply cannot be increased. The term 'land' includes all physical elements in the wealth of a nation bestowed by nature; such as climate, environment, fields, forests, minerals, mountains, lakes, streams, seas, and animals.

Lease:

Written or implied contract by which an owner (the lessor) of a specific asset (such as a parcel of land, building, equipment, or machinery) grants a secondparty (the lessee) the right to its exclusivepossession and use for a specific period and under specified conditions, in return for specified periodicrental or lease payments.

Liberalism:

Concept that a government should not try to controlprices, rents, and/or wages but instead let opencompetition and forces of demand and supplycreate an equilibrium between them that benefits the vast majority of citizens. It differs from the doctrine of laissez faire in its acceptance of the government intervention to control creation and spread of monopolies and in distribution of public good. Economic liberalism, in general, favors redistribution of income through taxes and welfarepayments.

Macroeconomics:

Study of the behavior of the whole (aggregate) economies or economic systems instead of the behavior of individuals, individual firms, or markets (which is the domain of Microeconomics). Macroeconomics is concerned primarily with the forecasting of national income, through the analysis of majoreconomicfactors that show predictable patterns and trends, and of their influenceon one another. These factors include level of employment/unemployment, gross national product (GNP), balance of paymentsposition, and prices (deflation or inflation). Macroeconomics also coversrole of fiscal and monetary policies, economic growth, and determination of consumption and investmentlevels.

Market:

Actual or conceptual place in commercialworld where forces of demand and supplyoperate, and where buyers and sellers interact (directly or through intermediaries) to tradegoods, services, or contracts or instruments, for money or barter.

Microeconomics:

Study of the economicbehavior of individualunits of an economy (such as a person, household, firm, or industry) and not of the aggregate economy (which is the domain of macroeconomics). Microeconomics is primarily concerned with the factors that affect individual economic choices, the effect of changes in these factors on the individual decisionmakers, how their choices are coordinated by markets, and how prices and demand are determined in individual markets. The mainsubjects covered under microeconomics includetheory of demand, theory of the firm, and demand for labor and other factors of production.

Money

The coins or notes which are used to buy things, or the amount of these that one person has.

Monopoly

Market situation where one producer (or a group of producersacting in concert) controlssupply of a good or service, and where the entry of new producers is prevented or highlyrestricted. Monopolistfirms (in their attempt to maximize profits) keep the price high and restrict the output, and show little or no responsiveness to the needs of their customers.

SUPPLY AND DEMAND: HOW MARKETS WORK

Here is a link to a Wall Street Journal Classroom Edition article. This article provides a real‐life example of music concerts tickets to describe how prices fluctuate as supply and demand change.

Did I Pay Too Much for Lady Gaga Tickets?
How to avoid rip‐offs when buying tickets to concerts this summer.

Concert ticket economics can be a little hard to untangle, especially when you are buying through the secondary market. Sometimes, even when demand dips, prices rise. Take this year. Concert attendance for the first three months slipped 3% over the same period in 2009, according to Live Nation Entertainment, a leading concert promoter. Yet spending per concertgoer over the same period ticked up 2%, to $59.71, and prices on the secondary market — brokers like Stubhub.com or Ticketnetwork.com — rose by an average of 8%, according to SeatGeek, an aggregator of secondary ticket site prices. The reason is pretty straight forward. If you're buying on the secondary market, you’re dealing with a broker who not only has access to harder‐to‐score tickets, but who is in it to make a profit. About 80% of tickets sold on the secondary market are professional ticket brokers, says Jack Groetzinger, co‐founder of SeatGeek. So how do you know if you are getting a good deal — or getting ripped off — when you are booking your summer entertainment? Here are some tips. 1. Look everywhere ‐‐ even if the concert isn’t sold out yet Lady Gaga tickets for July 1 in Boston start at $49.50 on the primary market, and are marked up to between $95 and $1,650 on secondary sites. Should you spring for the difference? Rule No. 1 is to get an idea of the market. How much are tickets purchased directly from the venue? How much is the broker marking them up? And most crucially, is the event sold out? Roughly 40% of the tickets on the secondary market are cheaper than at the box office, says SeatGeek’s Groetzinger. If an event is not sold out, prices “are nearly always better” on the secondary market because sellers have to lower them in order to be competitive with the box office. There are exceptions. For instance, tickets for Brandi Carlile, at The National in Richmond, Va., on June 6, are still on sale for between $16 and $26 apiece through Ticketmaster. The lowest price listing on StubHub on Friday was $84. 2. Don’t buy at the wrong time If possible, get on a band’s fan list early and you can get either discounts or first access to tickets. Dave Matthews Band, for example, is famous for this. Also, never buy a ticket for a big venue the weekend it goes on sale, says StubHub’s spokesperson. “The [secondary] market hasn’t had a chance to set the price,” he says. Be wary of someone who is selling a ticket the day after it went on sale — he likely only bought it to sell it for more money. Lastly, if you're interested in tickets to a popular artist in a small venue, prices increase as the event approaches, so look to buy early, says Groetzinger. If it’s a less famous artist playing in a big venue, prices tend to go down as the event date approaches, so be patient. 3. Group your bands, check the schedule and get a map Festivals allow you to catch multiple bands for a fraction of what it would cost to see them individually. Single‐day tickets to New Orleans Jazz and Heritage Festival in April were just $45 in advance and $60 at the gate, and concertgoers had 11 stages to choose from, with headliners like Simon & Garfunkel and Pearl Jam. But if you’re going primarily for two or three artists, make sure they aren’t performing at the same time on different stages. And check the map to see that you're able to get from one stage to the next in time, says the StubHub spokesperson. On the opening day of New Orleans Jazz and Heritage Festival, for instance, the Black Crowes and Lionel Richie played at the same time. 4. Don’t buy from scalpers With digitized tickets, it’s easier for fraudsters to sell multiple sets or to alter and repeat barcodes. Lady Gaga fan Nina Liotta, for instance, recently made headlines in New York for paying $300 for fake concert tickets. There’s no money trail, as you would usually pay cash, so you’re left empty handed and unable to get in, says Groetzinger. Buying electronic tickets that are emailed to you can be risky too: You don’t know who else they’ve been emailed to. A handful of secondary markets will have a 100% money back guarantee. StubHub and SeatGeek recommend stearing clear of Craigslist to avoid scams and because the site doesn't provide guarantees. Craigslist advises that you deal locally with people you can meet in person. “Follow this one simple rule and you will avoid 99% of the scam attempts on Craigslist,”the site says.

ACTIVITIES:

1. Identify the definitions below with four key economics concepts in order to understand the topic

a) The amount of a good or service that buyers are willing and able to buy at all possible prices during a period of time.

b) Places, institutions or technological arrangements where or by means of which goods or services are exchanged. Also, the set of all sale and purchase transactions that affect the price of some good or service.

c) The amount of a good or service that producers are willing and able to offer for sale at each possible price during a given period of time.

d) The amount of money must be paid in exchange for a product or service.

2. What is the difference between a primary market and a secondary market?

3. Explain the market behavior and how demand and supply interact with price changes. This website explains the relationship between supply and demand and how they form the backbone of the market economy. www.investopedia.com/university/economics/economics3.asp

4. Find other examples to illustrate the difference between the theoretical behavior of the market and real life.

THE ECONOMICS A-Z (i-j-k)

Read the follwing definitions of vocabulary associated with Economics. Then try to find the Spanish word:

Incentives - Factors that motivate and influence the behavior of households and businesses. Prices, profits, and losses act as incentives for participants to take action in a market economy.

Imports - Goods or services bought from sellers in another nation. Income - The payments made for the use of borrowed or loaned money.

Income Tax - Annual tax levied by the states, and some local governments, on an individual's or corporation's net profit.

Inflation - A sustained and continuous increase in the general price level.

Insurance - A promise of compensation for specific potential future losses in exchange for a periodic payment.

Interdependence - Dependence on others for goods and services; occurs as a result of specialization.

Interest rate - The price paid for borrowing money for a period of time, usually expressed as a percentage of the principal per year.

Investment - In finance, the purchase of a financial product or other item of value with an expectation of favorable future returns. In general terms, investment means the use money in the hope of making more money.

Invoice - A bill issued by one who has provided products and/or services to a customer.

Job - The regular work which a person does to earn money.

Joint - Pertaining to multiple parties on the same side of an agreement or transaction.

Junk bond - A high-risk bond with a low credit rating, usually BB or lower; as a consequence, it usually has a high yield.

Just in time - A strategy for inventory management in which raw materials and components are delivered from the vendor or supplier immediately before they are needed in the manufacturing process.

Keynesian Economics - Named for economist John Maynard Keynes. An economic theory which advocates government intervention, or demand-side management of the economy, to achieve full employment and stable prices

THE ECONOMICS A-Z (g-h)

Read the follwing definitions of vocabulary associated with Economics. Then try to find the Spanish word:

General Equilibrium - This is when Demand and Supply are in balance (the market is in Equilibrium) for each and every good and service in the economy.

Globalisation - A word that refers to the trend for people, firms and governments around the world to become increasingly dependent on and integrated with each other.

Goods - Objects that can satisfy people's wants.

Goodwill - An intangible asset which provides a competitive advantage, such as a strong brand, reputation, or high employee morale.

Government - National, state and local agencies that use tax revenues to provide goods and services for their citizens.

Gross domestic product (GDP) - The value, expressed in dollars, of all final goods and services produced in a year.

Gross national product (GDP) - Another measure of a country's economic performance. It is calculated by adding to GDP the Income earned by residents from investments abroad, less the corresponding income sent home by foreigners who are living in the country.

Growth - A positive change in the level of production of goods and services by a country over a certain period of time.

Households - Individuals and family units which, as consumers, buy goods and services from firms and, as resource owners, sell or rent productive resources to business firms.

Human capital - The health, strength, education, training, and skills which people bring to their jobs.

Human resources - The quantity and quality of human effort directed toward producing goods and services (also called labor).

Hyperinflation - A period of rapid inflation that leaves a country's currency virtually worthless.

THE ECONOMICS A-Z (e-f)

Read the follwing definitions of vocabulary associated with Economics. Then try to find the Spanish word:

Earn - Receive payment (income) for productive efforts.

Economics - The study of how society uses its scarce resources.

Economic growth - An increase in the total output of a nation over time. Economic growth is usually measured as the annual rate of increase in a nation's real GDP.

Economic system - The collection of institutions, laws, activities, controlling values, and human motivations that collectively provide a framework for economic decision making.

Elasticity - A measure of the responsiveness of one variable to changes in another.

Employment - When someone is paid to work for a company or organization.

Entrepreneur - One who organizes, manages, and assumes the risks of a business or enterprise.

Entrepreneurship - The human resource that assumes the risk of organizing other productive resources to produce goods and services.

Equilibrium price - The market clearing price at which the quantity demanded by buyers equals the quantity supplied by sellers.

Equity - Fairness and impartiality towards all concerned, based on the principles of evenhanded dealing.

Exchange - Trading goods and services with others for other goods and services or for money (also called trade). When people exchange voluntarily, they expect to be better off as a result.

Exchange rates - The rate, or price, at which one country's currency is exchanged for the currency of another country.

Exports - Goods or services produced in one nation but sold to buyers in another nation.

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Factor Cost - A measure of output reflecting the costs of the factors of production used, rather than market prices, which may differ because of indirect tax and subsidy (see GDP).

Factors of production - The ingredients of economic activity: Land, Labour, Capital and Enterprise.

Financial System - The Firms and institutions that together make it possible for Money to make the world go round.

Fiscal Policy - One of the two instruments of Macroeconomic Policy; Monetary Policy's side-kick. It comprises Public Spending and Taxation, and any other Government income or assistance to the private sector.

Fixed Costs - Production costs that do not change when the quantity of Output produced changes, for instance, the cost of renting an office or factory space. Final goods - Products that end up in the hands of consumers.

Full Employment - A term that is used in many senses. Historically, it was taken to be that level of employment at which no (or minimal) involuntary unemployment exists. Today economists rely upon the concept of the natural rate of unemployment to indicate the highest sustainable level of employment over the long run.

CONTINENTAL CRACK-UP

Take a break and enjoy this funny video: Ice Age Short Film ‘Scrat’s Continental

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