Economic Terms
Depression:
An extended period--a decade or so--of restructuring and institutional change in an economy that's often marked by declining or stagnant growth. During this period, unemployment tends to be higher and inflation lower than a regular, run-of-the-mill recession. Moreover, a depression usually lasts in the range of ten years, often encompassing two or three separate shorter-run business cycles. The most noted depression in the U. S. economy was the Great Depression of the 1930s.
Poverty Line: The official measure of the income needed by a family based on family size, location, and characteristics of the head of the household. The official U.S. poverty line is based on more of a relative poverty level rather than an absolute poverty level. For example, a family of two living in a rural area would need a different amount of money to stay above the official poverty line that would a family of four living in a city.
Surplus:
The amount that remains when use or need is satisfied; an excess of receipts over disbursements. Also, the excess of a corporation's net worth over the par or stated value of its capital stock
Absolute advantage: the benefit enjoyed by a producer who can supply a certain quantity of an item more efficiently than can other producers
Free Trade Agreement (FTA): the 1988 pact between Canada and the United States to form a free trade area
Traditional economy:
A mode of economic organization which borrows economic decisions made at an earlier time or by an earlier generation
North American Free Trade Agreement (NAFTA):
North American Free Trade Agreement (NAFTA): the 1993 pact among Canada, the United States, and Mexico to form a free trade area
Universality: the principle applied to transfer payments, whereby benefits are provided to all, regardless of income
Capital: All buildings, equipment and human skills used to produce goods and services.
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.
