Economics/Glossary

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Glossary of terms related to Economics.
"(more specialised glossaries are available on the Related Articles subpages of other economics articles)
  • Arbitrage [r]: transactions to take advantage of a price differences of a product in different markets by buying where it is cheap and selling where it is dear. The possibility of arbitrage often prevents the occurrence of price differences. [e]
  • Automatic stabilisers [r]: the tendency in times of falling economic activity for the government spending to rise, and for tax receipts to fall - and the reverse tendency in times of rising economic activity [e]
  • "Bad bank" [r]: Add brief definition or description
  •  Base money See Monetary base
  • Beta [r]: A measure of the degree to which the rate of return of a share tracks that of the equity market as a whole (defined as the covariance between the share's rate of return and the average market rate, divided by the variance of the market rate). If beta = 1 the share's rate of return moves in line with the market rate; if it is negative, it falls when the market rate rises. [e]
  • Bill of Exchange [r]: A written order to pay the holder a stated sum of money at a stated date (otherwise known as a "draft", the person who is paid being termed the "drawer"). [e]
  • Budget balance [r]: the difference between a central government's revenue and its expenditure in a given financial year. Conventions differ concerning the items that are included, and various cyclical adjustments can be made to identify its discretionary element.. [e]
  • Budget deficit [r]: the excess of a government's expenditures over its receipts. See also cyclically-adjusted budget deficit [e]
  • Capital (banking) [r]: A bank's assets minus its liabilities. [e]
  • Capital adequacy ratio [r]: The ratio of a bank's capital to its risk weighted credit exposures. May be defined in terms of tier 1 (core) or tier 2 capital. [e]
  • Capital adequacy ratio [r]: The ratio of a bank's capital to its risk weighted credit exposures. May be defined in terms of tier 1 (core) or tier 2 capital. [e]
  • Central Bank [r]: A government agency that is responsible for monetary policy and the support of the banking system (for example the Federal Reserve Board and the Bank of England). Usually responsible for controlling a country's monetary policy and preserving the value of its currency. [e]
  • Commercial paper [r]: unsecured debt_instruments that are issued by corporations to meet short term financing needs (usually repayable after 3 months). [e]
  • Contagion (banking) [r]: the spread of a run, loss or insolvency from one bank to another, or the spread of a banking crisis from one country to another. [e]
  • Corporation [r]: Please do not use this term in your topic list, because there is no single article for it. Please substitute a more precise term. See Corporation (disambiguation) for a list of available, more precise, topics. Please add a new usage if needed.
  • Cost_of_capital [r]: The weighted average of the rates of return paid by a company on its equity (share issue) and on its debt (bonds and commercial borrowing). [e]
  • Covariance [r]: A statistical parameter that indicates whether two random variables show a related linear trend. [e]
  • Credit crunch [r]: the failure of the banking system to satisfy the economy's need for credit. [e]
  • Credit risk [r]: The risk that the value of a loan-based security will fall as a result of defaults on the part of borrowers (as distinct from interest rate risks and exchange rate risks). [e]

{{r|Crowding out]]