Notes, summaries, assignments, exams, and problems for Economy

The Labor Market: Understanding Employment Dynamics

The labor market is the arena where employers (buyers) and job seekers (sellers) converge to exchange work and skills. It's a dynamic environment shaped by various factors.

Population Classification for Labor Purposes

• Active Population: Individuals who are either employed or actively seeking employment (unemployed).
• Inactive Population: Individuals who are neither employed nor actively seeking employment (e.g., students, retirees, homemakers).

Participation and Unemployment Rates

Key indicators of labor market health include the participation rate (percentage of the working-age population that is active) and the unemployment rate (percentage of the active population that is unemployed).

Employment

... Continue reading "Your Path to Employment: Skills, Search, and Interview Mastery" »

Key Business & Economic Terms

COMPANY: An economic unit that is used to produce goods and services.

ECONOMIC ACTIVITY: This is part of human activity that has to do with allocating scarce assets to fulfill unlimited wants.

CORPORATE SOCIAL RESPONSIBILITY: It is a responsibility firms voluntarily assume that goes beyond what the law requires.

MULTINATIONAL: A large company headquartered in one country with branches in other countries.

GLOBALIZATION: The extension of economic, cultural, and social processes across the world.

DECOLONIZATION: Consists of a transfer of economic activity from one company to another country for advantages that benefit the company.

An economic good: It is scarce, limited, and requires payment.

INDUSTRIAL PROPERTY: A property... Continue reading "Key Business & Economic Terms: A Concise Reference" »

The Public Sector: An Overview

The public sector comprises institutions whose activities are guided by political decisions. It is divided into public administration and public enterprises.

Economic Functions of the Public Sector

The public sector serves several key economic functions:

• Acting as an economic agent.
• Regulating economic relations.
• Providing public goods.
• Implementing economic policy.

Regulation

Regulation involves establishing standards and procedures that economic agents must follow to address economic problems.

Reasons for Regulation

• To compensate for market failures.
• To provide collateral security.
• To ensure the common good.
• To guarantee efficiency.
• To ensure fair competition.

Deregulation

Deregulation involves eliminating laws and regulations... Continue reading "Understanding the Public Sector: Economic Functions and Policy" »

The Buying Decision Process: Stages

These are the operating phases involved in a new buying situation. In repurchase scenarios, whether modified or direct, some of these stages are reduced or omitted.

1. Identification of the Problem

Someone within the company becomes aware of a problem or need that can be met by purchasing a good or service. This realization occurs through internal or external stimuli.

2. General Need Description

This stage involves describing the general characteristics, required quantity, and timing of the need.

3. Product Specification

The buying organization decides and specifies the optimal technical features of the product. Sometimes, a team is assigned to conduct a value analysis, carefully studying the most important components... Continue reading "Organizational Buying Decision Process Stages" »

Components of Economic Policy

Tax Policy

Tax policy is an essential tool to facilitate growth, investment, and social balance. It is a key concern for the Government.

Exchange Policy

Exchange policy is the joint action implemented by the monetary authority to establish or manage the exchange rate parity.

Interest Rate

The interest rate is the percentage applied to a sum of money (capital) and is equivalent to the amount to be paid or charged for loaning or borrowing money.

Money Supply

The money supply is the principal variable used. It is the amount of money circulating in the economy to move the commercial and financial transactions of society. It is the package of cash circulating in the economy and serves to cherish and value, deferring future... Continue reading "Understanding Economic Policy: Key Components and Mechanisms" »

Fundamental Economic Concepts and Definitions

A comprehensive glossary covering core microeconomic and macroeconomic terms, national accounting metrics, and inflation measures.

Microeconomics and Macroeconomics

Microeconomics

The analysis of how individuals and firms make economic decisions and how these decisions interrelate within markets.

Macroeconomics

The study of the efficiency, performance, and structure of a country's economy as a whole.

National Wealth and Accounts

National Wealth

The difference between the monetary value of a state's assets (property and rights owned by a company, institution, or individual) and its liabilities (all debts and commitments owed by an enterprise, institution, or individual) at any given time.

National Accounts

... Continue reading "Essential Economic Terms: Definitions of GDP, Inflation, and National Income" »

Long-Term Leasing and Renting

Leasing financing is a system whereby a company can incorporate fixed assets in exchange for lease fees. This process involves three operators: the client who needs the asset, the leasing firm that finances the acquisition and delivers the asset to the customer company in exchange for rent, and the company that manufactured or provides the asset.

Renting is the rental of movable and immovable property under a long-term contract. The tenant agrees to pay a fixed monthly income for a specified period. The leasing company is committed to providing these services: facilitating the use of the asset, maintenance, comprehensive insurance, and the option of ending the contract, replacing the equipment, or renewing the contract.... Continue reading "Corporate Financing Methods and Securities" »

Matching Terms with Definitions

Match the following terms with their definitions:

1. Value of Land (Income Economics): The value of land increases over time depending on location.
2. Oligopoly: Producers collaborate to maximize profits.
3. Wage Theory: Individuals are compensated based on the value of their marginal product.
4. Price Theory: Characterized by product differentiation and sales promotion.
5. Monopolistic Competition: Considers both supply and demand factors.
6. Monopoly: Market power is often measured using the concentration ratio.
7. Dumping: Selling goods produced domestically at a lower price in foreign markets.
8. Scope Economics: Combining two or more lines of production within a business.
9. Perfect Competition: Prices are determined by the interaction of supply

... Continue reading "Key Economics Terms and Concepts" »

The Nature and Functions of Money

Money is a generally accepted medium of exchange or payment. Its key features include serving as a medium of exchange and a unit of account.

Factors Influencing the Demand for Money

The demand for money is influenced by several factors:

• The average level of prices.
• Income or real wealth.
• The interest rate (representing market risk).

The Price of Money and Loan Factors

The price of money, or the interest rate, is the payment received for lending capital. Factors influencing this include:

• Risks of the operation: Higher solvency generally leads to easier lending.
• Liquidity: Assets that can be converted into cash quickly without significant loss of value.
• Duration of the loan: Longer loan terms may require higher interest

... Continue reading "Understanding Money: Functions, Demand, and Financial Systems" »

Core Accounting Concepts

Accounting Fundamentals

Accounting is a branch of economics that studies business assets, the rules, and the principles upon which a company's financial information is recorded. It provides a static snapshot of a company's financial health and aims to deliver crucial information to various levels and users within and outside the business, including:

• Managers
• Owners or Shareholders
• Workers
• Company Creditors
• Public Administration (for tax purposes)
• Unions

Understanding Business Assets

Business assets encompass the entire set of rights, tangible and intangible assets, and liabilities that a company possesses, valued in relation to its operational objectives.

Assets: Economic Structure of a Company

Assets represent the economic structure... Continue reading "Accounting Essentials: Financial Statements and Business Assets" »