Political Economy 2023 with complete solution

political economy the study of how politics and economics are related and how their relationship shapes the balance between freedom and equality markets interactions between the forces of supply and demand and the allocation of resources through the process of those interactions property the ownership of the goods and services exchanged through the markets public goods defined as those goods, provided or secured by the state, that are available for society and indivisible, meaning no private person or organization can own them social expenditures the state's provision of public benefits, such as education, health care and transportation ("welfare") gross domestic product total market value of goods and services produced by one country in a year central bank institution that controls how much money is flowing through the economy, as well has how much it costs to borrow money in that economy inflation defined as an increase in the overall prices in the economy when demand outstrips supply hyperinflation inflation that is higher than 50 percent a month for more than two months in a row deflation when too many goods are chasing too little money regulations rules or orders that set the boundaries of a given procedure monopoly a market controlled by a single producer tarriffs taxes on imported gods quotas limit the quantity of a good coming into the country nontarriff regulatory barriers create health, packaging or other restrictions and whose purpose is to protect its citizens and make it difficult or expensive for foreign goods to be sold in the local market comparative advantage the ability to produce a particular good or service more efficiently than other countries political-economic system defined as the actual relationship between political and economic institutions in a particular country, as well as the policies and outcomes they create lasseiz-faire holds that the economy should be allowed to do what it wishes capitalism system of private property and free markets neocorporatism system of policy making involving the state, labor and businesses mercantilism focuses on the needs of the state; focus on their position in the international system parastatals full or partial state ownership of specific industries purchasing-power parity attempts to estimate the buying power of income in each country by comparing similar costs such as food and housing using prices in the US as a benchmark Human Development Index looks at the total amount of wealth in a society and its distribution but also gives equal weight to income, health and educational indicators economic liberalization cutting taxes, reducting regulation, privatizing state owned businesses, etc.