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Preliminary Topic: Principles of Economics, Topic 8 Business Environment…

- - - - Society faces a short-run trade-off between inflation and unemployment
      - Prices rise when the government prints too much money
      - A country’s standard of living depends on its ability to produce goods and services
      - Governments can sometimes improve market outcomes
      - Markets are usually a good way to organise economic activity
      - Trade can make everyone better off
      - People respond to incentives
      - Rational people think at the margin
      - The cost of something is what you give up to get it
      - People face trade-offs
- - - - The law of supply states that, ceteris paribus, the quantity supplied of a good rises when the price of the good rises.
      - The law of demand states that, other things being equal, the quantity demanded of a good falls when the price of the good rises.
  - - - Total surplus is the sum of these two areas.
  - - - Effects of a tax
- - - - GDP and its components
  - - - The nominal interest rate is the interest rate usually reported and not corrected for inflation. It is the interest rate that a bank pays.
        The real interest rate is the nominal interest rate that is corrected for the effects of inflation.
  - - - physical capital
      - human capital
      - natural resources
      - technological knowledge.
    - - Saving and investment
      - Investment from abroad
      - Education
      - Health and nutrition
      - Property rights and maintain political stability
      - Promoting free trade
      - Discouraging excessive population growth
      - Promoting research and development
    - - 1.Banks (take deposits from people who want to save and then use the deposits to make loans to people who want to borrow)
        2.Managed funds (an institution that sells shares to the public and uses the proceeds to buy a selection, or portfolio, of various types of shares, bonds, or both)
  - - - Three types of unemployment help explain why natural unemployment never falls to zero:
        
        Classical unemployment - arises because the real wage in the labour market is above the ‘market clearing level’. One prime example of this is Minimum-wage laws. If the minimum-wage is set above the level that balances supply and demand, it creates unemployment.
        
        Frictional unemployment - is the unemployment that results from the time that it takes to match workers with jobs. It is inevitable because the economy is always changing.
        
        Structural unemployment is the unemployment as a result of a mismatch between that skills that business require and the skills that workers have.
  - - - The supply and demand curve:
    - - Shoeleather costs
      - Menu costs
      - Relative-price variability and the misallocation of resources
      - Inflation-induced tax distortions
      - Confusion and inconvenience
      - A special cost of unexpected inflation: arbitrary redistributions of wealth.
  - - - Exports are goods and services that are produced domestically and sold abroad.
      - Imports are goods and services that are produced abroad and sold domestically.
      - Trade balance (net exports) (NX) are the value of a nation’s exports minus the value of its imports.
    - - The tastes of consumers for domestic and foreign goods
      - The prices of goods at home and abroad
      - The rates at which people can exchange domestic currency for foreign currencies
      - The cost of transporting goods from country to country
      - The policies of the government towards international trade.
- - - - Domestic individual investors
      - Financial intermediaries and financial service providers, including brokers, integrated securities companies, investment banks, and trust companies
      - Domestic institutional investors
      - Qualified foreign institutional investors (QFII).
  - - - Enterprise Bonds (企业债券): Regulator: NDRC
      - Corporate Bonds (公司债券): Regulator: CSRC
      - Short-Term Commercial Papers (短期商业票据): Regulator: PBOC
      - Medium-Term Notes (中期票据)：Regulator: PBOC
- - - - Lack of due process and regulatory transparency
      - Lengthy time periods for merger reviews
      - Role of non-competitive factors in competition enforcement
      - Determination of remedies and fines
      - Broad definition of monopoly agreements
      - Fair treatment and non-discrimination
  - - - While often seen as an engine of the global economy, in terms of political integrity and governance, the region performs only marginally better than the global average. Many countries see economic openness as a way forward, however, governments across the region, from China to Cambodia to Vietnam, continue to restrict participation in public affairs, silence dissenting voices and keep decision making out of public scrutiny.