Key Economic Concepts and Global Institutions
Key Economic Concepts
Benefit: The result of the difference between expenditure and revenue.
Market: The set of consumers who demand goods and services and all the producers that offer them.
Good and Service: A good is any object, and a service is an activity intended to satisfy a need.
Cost of Living and Inflation: The cost of living is the minimum amount of expenditure for essential goods and basic services (Consumer Price Index – CPI). The rise in commodity prices is inflation.
Investment and Speculation:
Read MoreSpain’s Economic Transformation in the 1920s
Infrastructure Development Under Primo de Rivera
Roads: The road network expanded from 5,000 km to 10,000 km. Highways were established, modernizing the economy and unifying previously isolated areas.
Water Boards: These provided water for irrigation in the cereal-producing regions of Castile and generated electricity.
These projects were financed with debt.
Economic Growth and Structural Changes in the 1920s
There was significant growth in investment during the growth stage (1923-1929). However, this
Read MoreCentral Bank: Roles, Policies, and Impact on the Economy
Central Bank: Roles, Policies, and Economic Impact
The Central Bank is an autonomous and independent institution responsible for ensuring currency stability and the normal functioning of internal and external payments.
Autonomy Goals
- Currency Stability: Ensuring the stability of the currency, preventing its deterioration due to inflation. The Central Bank’s priority is to maintain low and stable inflation.
- Normal Functioning of Domestic Payments: Facilitating transactions within the economy through
Market Research: Understanding Consumers & Competition
Market Research: A Comprehensive Overview
Market research involves gathering, processing, and analyzing information about the industry environment, competition, and consumers.
1. Defining Research Objectives
The initial phase of any market study involves clearly defining the research objectives. It’s crucial to establish what information you aim to gather and the goals you want to achieve.
2. Designing the Research Model
Once the objectives are defined, determine how the investigation will be conducted.
Read MoreUnderstanding Company Costs, Commercial Departments, and Market Research
Company Costs
The cost of production is the value of productive factors used in the production of a good or a service.
Fixed Costs
Those costs independent of output level, i.e., they do not change if you change the quantity produced.
Variable Costs
Those costs that vary with the level of production. In the short term, it’s important to differentiate between fixed and variable factors. However, in the long term, all costs are variable.
Direct Costs
Those costs directly associated with production and that
Read MoreEconomic Policy: Unemployment, Inflation, and Aggregate Demand
Economic Policy Objectives
Item 9 focuses on key economic policy objectives: low unemployment, low inflation, and a low deficit.
Aggregate Demand
Aggregate demand (D) represents the total demand for goods and services in an economy at a given price level. We can distinguish three levels of demand:
- Aggregate Demand (D): The total demand across all markets.
- Market Demand: Demand within a specific market.
- Individual Demand: Demand from a single consumer.
Components of Aggregate Demand
Aggregate demand is composed
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