Edexcel A Level Business - Theme 2.5

Appreciation of a currency - A rise in the value of a currency Base rate - The rate of interest around which a bank structures other interest rates. Boom - The peak of the economic cycle where GDP is growing at its fastest Consumer price index (CPI) - A common measure of price changes used in the UK Deflation - A fall in the general price level. Depreciation of a currency - A fall in the value of a currency Downturn - A period in the economic cycle where GDP grows, but more slowly Business cycle - A diagram showing the fluctuations seen in an economy (e.g. boom, recession, etc.) Exchange rate - The price of one currency in terms of another Government expenditure - The amount spent by the government in its provision of public services GDP - the total market value of all final goods and services produced in an economy. Usually measured quarterly. Inflation - A general rise in prices Recession - A less severe form of depression Recovery or upswing - A period where economic growth begins to increase again after a recession Slump or depression - The bottom of the business cycle where GDP is at it's lowest with significant increases in unemployment Taxation - The charges made by government on the activities, earnings and income of businesses and individuals Collusion / acting as a cartel - Two (or more) businesses agreeing to a restrictive practice, such as price fixing