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Economic Terms

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Wages

The reward for providing labour.

Wants

The desires that encourage the consumption of goods and services.

Wealth

The amount of assets, valuable items and resources owned by an individual, firm or any country or group. Wealth is usually applied to generate an income for the owners.

Below highglights some of the basic features of wealth. For instance wealth is the accumlation of value of assets and as a result very little of a person's wealth is spent, with the main reason being because it is less liquid and primarily income is used for day to day transactions.


Wealth effect

Any change in consumption that occurs due to an increase in personal wealth e.g. if the value of the stock market doubles this should encourage households to increase consumption.

Wealth of Nations

A famous economics book written by Adam Smith, widely renowned as one of the founding fathers of modern economics. the book considered the nature and causes of wealth and aspects of production and free markets.


Weighting

Is a statistical technique that allows the emphasis given to different data items to be varied e.g. the goods and services covered by the CPI are weighted to reflect the expenditure of a typical household.

Welfare benefits

Benefits paid by a government to help ensure everyone receives a mimimum standard of living.

Wholesale banking

When banks provide services to firms and other banks.

Windfall tax

A sudden and one off tax that a Government might impose on the profits of suppliers if they are manipulating a market to increase profits at the expense of consumers. The purpose of this type of tax is to curb uncompetitive behaviour.


Withdrawals

Actions that reduce the value circulating in the circular flow. This falls into 3 categories - taxes collected by government, money set aside as savings and any money spent on imported goods and services.

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