Hsc Economics Notes the Global Economy Essay Example
The global economy
Key glossary of terms
Capitalism: an economic system where an individual rights, including private ownership , and the free operation of markets as the main determinant of production and distribution issues
Economic growth: sustained increase in the production of goods and services over time and is measured by percentage changes real gross domestic product (GDP)
Global Economy: Refers to the level of activity generated worldwide, as measured by the summation of domestic GDPs converted to a common unit of measurement, such as US dollars based on relative purchasing-power parity
Gross Domestic Product: (GDP) measure of total value of goods and services produced in an economy over a period of time
Purchasing Power Parity: taking a basket of common goods found in most countries and comparing their relative prices, bearing in mind they should cost the same in each country. This allows an alternative exchange rate calculation, to market-determined rate, and a more accurate world GDP determination
Advanced Economies: (developed/industrialised economies) have high per casita income and well-developed manufacturing and tertiary industries
Capital Flight: sudden movements of large amounts of debt funds out of an economy, which can lead to disruptions to domestic economic activity, exchange rate depreciations and financial contagion
Developing economies: have low levels of per capita income and limited industrialisation
External Shock : refers to a change in the world economy that can impact on the level of economic activity of a domestic economy
Financial Contagion: where a financial crisis occurring in one economy can spread to other economies in the region or even worldwide because of the integrated nature of financial markets
Foreign Direct Investment (FDI) is the purchase of real assets, such as factory, or the purchase of more than 10 per cent of shares in an existing company
International Business Cycle: is the changing world
Key glossary of terms
Capitalism: an economic system where an individual rights, including private ownership , and the free operation of markets as the main determinant of production and distribution issues
Economic growth: sustained increase in the production of goods and services over time and is measured by percentage changes real gross domestic product (GDP)
Global Economy: Refers to the level of activity generated worldwide, as measured by the summation of domestic GDPs converted to a common unit of measurement, such as US dollars based on relative purchasing-power parity
Gross Domestic Product: (GDP) measure of total value of goods and services produced in an economy over a period of time
Purchasing Power Parity: taking a basket of common goods found in most countries and comparing their relative prices, bearing in mind they should cost the same in each country. This allows an alternative exchange rate calculation, to market-determined rate, and a more accurate world GDP determination
Advanced Economies: (developed/industrialised economies) have high per casita income and well-developed manufacturing and tertiary industries
Capital Flight: sudden movements of large amounts of debt funds out of an economy, which can lead to disruptions to domestic economic activity, exchange rate depreciations and financial contagion
Developing economies: have low levels of per capita income and limited industrialisation
External Shock : refers to a change in the world economy that can impact on the level of economic activity of a domestic economy
Financial Contagion: where a financial crisis occurring in one economy can spread to other economies in the region or even worldwide because of the integrated nature of financial markets
Foreign Direct Investment (FDI) is the purchase of real assets, such as factory, or the purchase of more than 10 per cent of shares in an existing company
International Business Cycle: is the changing world