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| Question | Answer |
| Appreciation of currency | A rise in the value of a currency. |
| Base rate | The rate of interest around which a bank structures other interest rates. If the Bank of England raises the base rate, all other borrowing and savings rates are likely to move in the same direction and vice versa. |
| Boom | The peak of the economic cycle where GDP is growing at its fastest. |
| Consumer price index (CPI) | A common measure of price changes in the EU. |
| Deflation | A fall in the general price level. Also used to describe a situation where economic growth is falling or negative when inflation is falling. |
| Depreciation (or currency) | A fall in the value of a currency. |
| Downturn | A period in the economic cycle where GDP grows, but more slowly. |
| Economic Cycle (Business / Trade Cycle) |
Regular fluctuations in the level of output of the economy.
Image:
Business Cycle (image/png)
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| Exchange rate | The price of one currency in terms of another. |
| Fiscal policy | Using changes in taxation and government expenditure to manage the economy. |
| Government expenditure | The amount spent by the government in its provision of public services. |
| Gross domestic product (GDP) | A common measure of national income, output or employment. |
| Index linked | The linking of certain payments, such as benefits, to the rate of inflation. |
| Inflation | A general rise in prices. |
| Monetary policy | Using changes in the interest rate and money supply to manage the economy. |
| Slump or depression | The bottom of the economic cycle where GDP starts to fall with significant increases in unemployment. |
| Recession | A less severe form of economic depression. |
| Recover or upswing | A period where economic growth begins to increase again after a recession. |
| Taxation | The charges made by the government on the activities, earnings and income of businesses and individuals. |
| Anti-competitive or restrictive practices | Attempts by firms to prevent or restrict competition e.g. by price fixing. |
| Barriers to entry | Obstacles that make it difficult for new firms to enter a market. |
| Collusion | Two (or more) businesses agreeing to a restrictive practice, such as price fixing. |
| Contract of employment | A written agreement between an employer and an employee in which each has certain obligations. |
| Discrimination | Favouring one person over another. For example, in the EU it is unlawful t discriminate on grounds of race, gender, age and disability. |
| Employment tribunal | A court that deals with cases involving disputes between employers and employees. |
| National minimum wage | A wage rate set by the government below which it is illegal to pay people at work. |
| Unfair dismissal | The illegal dismissal of a worker by a business. |
| Cartel | A group of businesses (or countries) which join together to agree on pricing and output in a market in an attempt to gain higher profits at the expense of customers. |
| Colluding (same as collusion) | In business, where several businesses (or countries) make agreements among themselves which benefit them at the expense of either rival businesses or customers. |
| Market structures | The characteristics of a market, such as the size of the barriers to entry to the market, the number of business in the market or whether they produce identical products which determine behaviour of businesses in the market. |
| Homogeneous products/services | Products or services which are all essential the same e.g. cereal. |
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