Absolute Advantage: When a country can produce something more efficiently, in other words at less expense and effort, than another.

Aggregate: Another word for 'total'. Refers to a big figure -- for example, gross domestic product or a company's total sales over a year.

Automatic Stabilizers: A government's expenditure or receipts, which expand or contract to compensate for the economy's booms and busts.

Bank Run: When fearful customers all try simultaneously to pull their savings out of a bank, often leading to its collapse.

Bear Market: When there is a steady drop in the stock market, which leads to widespread pessimism and downward growth.

Bond: A certificate of debt from a country, state or company.

Bull Market: When there is investor confidence, which leads to widespread optimism and upward growth.

Capital: Money or physical assets used to produce an income.

Capitalism: The economic system in which capital is owned by private individuals and corporations.

Capital Controls: State-imposed restrictions on the amount of capital allowed in and out of a country.

Capital Markets: The broad term for markets where equities and bonds are issued and traded.

Central Bank: The main monetary authority of a country. It issues the national currency and regulates the supply of credit -- most notably by controlling interest rates.

Communism: The Marxist idea that capitalism would be succeeded by a society in which the people (or rather the government) own the means of production within an economy.

Credit: A polite word for debt; a promise to pay someone in the future for what one borrows today.

Credit Crunch: A financial crisis which makes banks reluctant or unable to lend money, causing the rest of the economy to suffer.

Default: When a person, institution or country fails to repay its debts.

Deficit: A shortfall in an account -- be it a government's budget deficit or an entire country's current account deficit.

Deflation: A situation where the prices of goods in an economy are, on average, falling rather than rising.

Demand: The total amount of goods or services people are willing and able to buy at a given price. Usually, as the price rises, people demand fewer goods.

Depression: A severe recession. Usually defined as a gross domestic product contraction of 10 per cent, or a recession that lasts three years or more.

Employment Rate: The percentage of the workforce with jobs.

Equilibrium Price: The price at which the supply of goods matches demand.

Exports: Goods and services that are produced domestically and then sold to foreign countries.

Fiscal Policy: The decisions a government takes about what to spend its money on, how to raise taxes and how much to borrow.

Gold Standard: An international system in which countries' currencies are fixed in relation to gold prices.

Hedge Funds: A type of investment vehicle which can bet on a company's value decreasing or increasing, as well as many other more complex strategies.

Hyperinflation: When inflation runs out of control. A highly damaging phenomenon most notoriously experienced by Germany in the 1920s and Zimbabwe in the 2000s.

IMF: The International Monetary Fund. An international organization charged with monitoring the global economy and rescuing countries facing funding crises.

Imports: Goods and services bought from overseas.

Inflation: The rate at which the price of goods throughout an economy is increasing.

Interest: The amount, expressed in a percentage, that someone can hope to receive back on an investment. Conversely it can be the amount someone is charged for borrowing.

Laissez-faire: From the French 'let (them) do (as they choose); where governments try as much as possible to leave the market to its own devices.

Liquidity: A measure of how easy it is for someone to exchange an asset -- for instance a house, a gold bar or a pack of cigarettes -- for money or other types of currency.

Macroeconomics: The study of government and international economics: taking a step back and examining how whole economies work and perform -- what drives gross domestic product, prices or unemployment.

Marginal: The difference it makes to buy or sell one extra unit of something, as opposed to the average cost of a product.

Market: Where buyers and sellers meet (often virtually) to trade goods and services.

Microeconomics: The study of the minutiae within economies: what makes people take certain decisions, how companies become profitable, and so on.

Monetary Policy: The decisions a government or central bank (usually the latter) make about regulating the amount and price of money flowing around the economy.

Money: Assets commonly used to purchase goods and settle debts. It is a medium of exchange, a unit of account and a store of value.

Money Markets: The web of dealers and investors in short-term lending -- anything from a few hours to a year.

Money Supply: The amount of money flowing around an economy.

Monopoly: The exclusive control by one seller of a particular product in a market.

Negative Equity: Where someone's asset, usually their home, falls in value so much that it becomes worth less than the mortgage or loan that funded it.

Privatization: When a company or institution which was previously government-owned is sold off to a privately owned entity.

Productivity: The amount of economic output generated compared with the amount of effort (in terms of hours worked or number of workers).

Quantitative Easing: Methods central banks employ when interest rates no longer work, as happened in japan in the 1990s and much of the Western world in the 2000s. It attempts to influence the quantity rather than the price of money in the economy.

Recession: A fall in a country's economic fortunes: when GDP contracts rather than grows for two successive quarters-Securities Financial contracts that grant someone a stake in an asset: this can mean everything from bonds and shares to complex derivatives.

Shares: Also known as equities. A unit of ownership in a company. Shares entitle the owner to a dividend, and a right to vote on the company's plans.

Stagflation: When high inflation is coupled with stagnant economic growth.

Subsidy: A sum of cash given by someone -- usually a government -- to support a particular business or industry. They are often reviled as a form of protectionism.

Supply: The total amount of goods or services which can be bought at a particular price. Together with demand, this is what powers a market economy.

Tariff: A fee imposed by a government on goods imported from overseas.

Zero-Sum Game: Where the winner's gains equal the losses of the losers. This contrasts with positive-sum games where both parties can profit to some degree.