Podcast
Questions and Answers
Political Economy is solely focused on economic analysis and market efficiency.
Political Economy is solely focused on economic analysis and market efficiency.
False
Traditional Neoclassical Economics deals primarily with a pre-capitalist economic system.
Traditional Neoclassical Economics deals primarily with a pre-capitalist economic system.
False
Income per Capita is calculated by dividing the Gross National Income by the total population.
Income per Capita is calculated by dividing the Gross National Income by the total population.
False
The Millennium Development Goals aim to maintain extreme poverty in developing countries.
The Millennium Development Goals aim to maintain extreme poverty in developing countries.
Signup and view all the answers
Human Development Index measures only the economic development of a nation.
Human Development Index measures only the economic development of a nation.
Signup and view all the answers
Depreciation refers to the increase in value of a product at each stage of production.
Depreciation refers to the increase in value of a product at each stage of production.
Signup and view all the answers
Free Trade allows goods to be imported and exported with no restrictions or barriers.
Free Trade allows goods to be imported and exported with no restrictions or barriers.
Signup and view all the answers
Resource Endowment refers to a nation's supply of unusable factors of production.
Resource Endowment refers to a nation's supply of unusable factors of production.
Signup and view all the answers
Diminishing Marginal Utility states that the subjective value of additional consumption increases as total consumption rises.
Diminishing Marginal Utility states that the subjective value of additional consumption increases as total consumption rises.
Signup and view all the answers
Convergence theory suggests that per capita income grows faster in higher-income countries compared to lower-income countries.
Convergence theory suggests that per capita income grows faster in higher-income countries compared to lower-income countries.
Signup and view all the answers
Study Notes
Economic Systems
- Subsistence economy: production is for personal consumption
- Traditional economics: emphasizes utility, profit maximization, and market efficiency
- Neoclassical economics: deals with advanced capitalist world of perfect markets
- Political economy: merges economic analysis with practical politics
- Development economics: studies how economies are transformed
Globalization and Social Systems
- Globalization: increasing integration of national economies
- Social system: organizational and institutional structure of a society
- Interdependent relationship of economic and non-economic factors
- Values: principles, standards, or qualities
- Attitudes: states of mind or feelings of an individual
- Institutions: norms, rules of conduct, and accepted ways of doing things
- Economic institutions: humanly devised constraints that shape interactions in an economy
Measurements and Indices
- Income per capita: total gross national income divided by total population
- Gross national income (GNI): total domestic and foreign output claimed by residents of a country
- Gross domestic product (GDP): total final output produced by a country's economy within its territory
- Functionings: what people do or can do
- Capabilities: freedoms that people have
- Sustenance: basic goods and services
- Self-esteem: feeling of worthiness society enjoys
- Freedom: society has a variety of alternatives to satisfy wants
Development and Poverty
- Millennium development goals: set of eight goals adopted to eradicate extreme poverty
- Sector: subset of an economy
- World Bank: international financial institution providing development funds
- Low-income countries: countries with GNI per capita of less than $1,025
- Middle-income countries: countries with GNI per capita between $1,025 and $12,475
- Newly industrializing countries: countries with close links to international trade, finance, and investment
- Least developed countries: countries with low income, low human capital, and high economic vulnerability
Production and Human Capital
- Human capital: productive investment in people
- Value added: portion of a product's final value added at each stage of production
- Depreciation: wearing out of physical productive equipment reflected in write-offs
- Capital stock: total physical goods at a particular time for use in production
- Purchasing power parity: calculation of GNI using common international prices
Human Development and Demographics
- Human development index: measures national socioeconomic development
- Diminishing marginal utility: subjective value of additional consumption lessens as total consumption becomes higher
- Crude birth rate: number of children born alive each year per 1,000 population
- Dependency burden: proportion of total population aged 0 to 15 and 65+
- Fractionalization: significant ethnic, linguistic, and other social divisions within a country
Markets and Trade
- Imperfect market: market in which perfect competition is violated
- Incomplete information: absence of information producers and consumers need to make efficient decisions
- Property rights: acknowledged right to use and benefit from tangible or intangible entities
- Free trade: goods can be imported and exported without any barriers
- Terms of trade: ratio of average export price to average import price
Research and Development
- Research and development: scientific investigation to improve the existing quality of human life
- Divergence: tendency for per capita income to grow faster in higher-income countries than lower-income countries
- Convergence: tendency for per capita income to grow faster in lower-income countries than in higher-income countries
- Brain drain: emigration of highly skilled workers from one country to another
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Test your knowledge on various economic perspectives such as subsistence economy, traditional economics, neoclassical economics, political economy, development economics, and globalization.
