Notes, summaries, assignments, exams, and exercises for Economics for Baccalaureate

The Essence of Money

Money is any instrument generally accepted as a medium of payment.

Conditions for Money:

1. Relatively scarce with a stable value over time.
2. Durable and resistant to damage.
3. Easily transferable and divisible.
4. Units are identical.

Role of Money

The main functions of money are to facilitate exchanges, measure value, and serve as a store of value:

Medium of Exchange

Money serves as a medium of exchange because it facilitates the exchange of goods and services. People use money to exchange it for goods, services, labor, etc.

Money simplifies exchanges and eliminates the inconvenience of barter.

In a barter economy, a double coincidence of wants is necessary for a transaction to occur. However, with a universally accepted medium of exchange...

Financial Intermediaries and the Financial System

The Financial System consists of institutions that mediate between claimants (borrowers) and suppliers (savers) of financial resources. Financial intermediaries are the key elements of this system. They can be classified into two main types:

Types of Financial Intermediaries

1. Banking Intermediaries
2. Non-Banking Intermediaries

1. Banking Intermediaries

Banking intermediaries include banks, savings banks, and rural banks. They possess the capacity to produce money, and their financial assets are widely accepted in payment of debts or transactions.

Definition and Role of a Bank

A Bank is a financial intermediary that receives funds from customers (deposits) to lend to others. Banks pay depositors a certain...

Understanding the Chart of Accounts

The Chart of Accounts is a fundamental framework born from the normalization of accounting practices. This standardization aims to establish consistent criteria for companies, enabling homogeneous, reasonable, and valid comparisons across different periods and entities.

EU Directives for Accounting Normalization

The European Union (EU) has issued a set of rules to implement accounting normalization in its participating countries. These directives are crucial for harmonizing financial reporting:

• The Fourth Directive: Also known as the European Accounting Plan, this directive establishes the financial information that corporate accounting should provide.
• The Seventh Directive: This directive sets the requirements

Economic Crises in Mexico (1976-2008)

Defining Economic Crisis

An economic crisis is characterized by a decline or stagnation in output and real incomes, leading to reduced employment and an uneven distribution of national wealth and income.

The 1976 Economic Crisis

1. Fiscal disorder in the U.S.
2. The Bretton Woods Agreement established the dollar as the reserve currency for all countries.
3. External financing of the fiscal deficit and current account.
4. In 1973, the Bretton Woods arrangement collapsed, and flotation was established between currencies.
5. High petroleum prices and increased contributions.
6. Excessive government spending.
7. Public debt as a percentage of GDP: 12% in 1970, rising to 35% in 1976.
8. Increased foreign loans and bank credit in Mexico.
9. Central

External Financial Resources: Medium and Long Term

Companies require various financial resources. Besides providing its own funding, a business often needs to utilize external financing. Medium and long-term funding resources are those which the company utilizes over a period longer than one financial year and, once that time has passed, must repay, typically with interest. Key medium and long-term resources include:

1. Medium to Long-Term Loans

Firms borrow from credit institutions (banks, savings banks, etc.) to finance purchases of fixed assets. Fixed assets are all those goods that the company uses to produce (i.e., machinery, buildings, computers, etc.). Due to their high value, companies usually seek medium to long-term loans. This money...

Key National Production Metrics

Gross Domestic Product (GDP)

GDP is the sum of production, valued at factor cost, of all productive sectors comprising the economy of a country. It reflects all final goods and services produced within the borders of the country in a year.

The GDP growth rate measures the relative importance of the change in GDP between two consecutive periods. GDP is the most commonly used indicator for studying a country's economy.

Gross National Product (GNP)

GNP is the market price value of all final goods and services produced by factors of production owned by the country's residents, regardless of whether the production occurs inside or outside its borders.

It differs from GDP by showing the output generated by factors of production...

ABC Model

The ABC model sorts by the relative importance of various stocks of a company when it has a large inventory with a wide variety of products and cannot devote the same time or the same resources to each. It is based on classifying stocks into three categories:

• Existences A: Items are most important for the management of supply, 20% of store items, overall, 60-80% of total stock.
• Existences B: Stock less relevant to the company, but must maintain a control system (less strict).
• Existences C: Stocks with very little relevance, control them specifically enough to more simplified methods.

JIT System

The Just-In-Time (JIT) system is an integrated management of production and supply developed in Japan in the 1980s. Currently, it is used in major...

The Company

A company is an entity that combines a set of factors of production, organized and operated in the best possible way. Through revenue from the sale of goods and services, it ensures a profit and achieves targets set in a plan.

The Company as a System

A system is a set of interrelated elements and their environment, arranged so that, through a process of transformation, a set of inputs becomes a set of outputs.

Business System Features

• It's a global system: All elements are interrelated, so a change in any of them affects the others.
• It's a self-regulating system: The balance is achieved through the actual interaction between its elements.
• It's an open system: It is in permanent contact with the outside, i.e., with its environment.
• It is

Types of Markets

Markets can be classified based on various criteria:

Based on Information and Transparency

A transparent market is one where agents are related and have all possible information. A market has friction when agents do not have all possible information.

Based on Goods Characteristics

A perfect market exists if the commodity traded is perfectly homogeneous. An imperfect market exists when the commodity is available in various models with different features.

Based on Player Power

A normal market is one where neither buyers nor sellers have the power to intervene in the market price. A forced market exists when they can act on the price.

Based on the Number of Participants

Markets can also be classified according to the number of buyers and...

Economic Agents and Their Roles

Companies: These entities focus on the production and distribution of goods and services, usually in exchange for a benefit or profit. The Public Sector (SP): Its objective is to achieve the greatest prosperity for the whole of society. Consumers: These are families who decide which goods and services to consume to best meet their needs.

Composition of Families and the Workforce

• Employers: Those responsible for organizing and coordinating productive activity to achieve specific objectives.
• Workers: Individuals who contribute their labor to the production process in exchange for a salary.

Key Job Characteristics

• Personal: The work must be performed specifically by the contracted person.
• Voluntary: The relationship must