Glossary

Aggregate Demand: Aggregate demand (AD) in economics refers to the total quantity of goods and services that all consumers in an economy are willing and able to purchase at different price levels, during a specific time period.

Altruism: "Behavior that benefits others, regardless of its motives."

Cognitive Bias: Cognitive bias refers to systematic patterns of deviation from rationality in judgment, where individuals make decisions or form beliefs based on subjective factors rather than objective evidence.

Egocentrism: Egocentrism is the practice of excessive interest in oneself and concern for one's own welfare or advantage at the expense of or in disregard of others.

Egoism: "Egoism" is a philosophical and ethical concept that refers to an individual prioritizing their own interests, desires, or well-being over those of others. In egoism, self-interest is seen as the foundation for making decisions and guiding actions.

Endothermic energy: Endothermic energy refers to the energy absorbed from the surroundings during a chemical reaction or process. In an endothermic reaction, the system takes in heat, leading to a cooling effect in the environment. An example of an endothermic process is the melting of ice. Heat is absorbed from the surroundings to convert ice (solid) into water (liquid), without the release of heat, resulting in the surrounding temperature dropping.

Existential Risks: Existential risks are risks or dangers that have the potential to cause the extinction of humanity or permanently and drastically reduce its potential for future progress.

Exothermic: An exothermic process is a chemical reaction or physical change that releases energy in the form of heat. In exothermic reactions, the energy of the products is lower than that of the reactants because energy is released to the surroundings. This causes the temperature of the surroundings to increase. A common example of an exothermic reaction is the combustion of fuels, like burning wood or gasoline, which produces heat and light.

Fiscal Policies: Fiscal policies refer to the strategies and actions that a government uses to influence its economy through its taxation and spending decisions. Fiscal policy is the use of government spending and taxation to influence the economy. These policies are aimed at achieving economic goals like controlling inflation, reducing unemployment, stimulating economic growth, and balancing government budgets.

Fossil Fuel: Fossil fuels are natural energy sources formed from the decomposed remains of ancient plants and animals, which have been buried and subjected to heat and pressure over millions of years. The main types of fossil fuels are coal, oil, and natural gas. They are primarily composed of carbon and hydrocarbons, and when burned, they release energy that can be used for electricity, heating, and transportation. Fossil fuels are considered nonrenewable resources because they take millions of years to form and are being depleted much faster than they are naturally replenished. Their combustion also releases significant amounts of carbon dioxide (CO₂) and other greenhouse gases, contributing to climate change.

Free Market Capitalism: Free Market Capitalism is an economic system in which the production, distribution, and prices of goods and services are determined by unrestricted competition between privately owned businesses. In this system, the government plays a limited role, typically intervening only to enforce contracts and property rights.

Kinetic energy: Kinetic energy is the energy an object has because of its motion.

Marginal Propensity to Consume: The marginal propensity to consume (MPC) is an economic term that describes the proportion of additional income that individuals or households spend on goods and services, rather than saving it. In simpler terms, it indicates how much of each extra dollar earned is used for spending.

Monetary Policies: Monetary policies refer to the actions and strategies implemented by a central bank or monetary authority to control the supply of money, manage interest rates, and achieve specific economic goals. These goals often include controlling inflation, promoting economic growth, and achieving full employment. Central banks, like the Federal Reserve in the United States or the European Central Bank, use tools such as open market operations, the discount rate, and reserve requirements to influence the economy.

Multiplier Effect: In economics, the multiplier effect refers to the proportional increase in final income that results from an injection of spending. It is the process by which an initial increase in spending (such as government expenditure, investment, or exports) leads to a larger increase in overall economic activity. The basic idea is that one person's spending becomes another person's income, and part of that income is spent again, generating further income and spending in subsequent rounds. This process continues, though with diminishing returns at each stage, because some income is saved or taxed rather than spent.

Nescience: "Nescience" refers to a lack of knowledge or awareness, essentially meaning ignorance or the absence of understanding. It comes from the Latin word *nescientia*, which means "not knowing" (*ne-* meaning "not" and *scire* meaning "to know"). It is often used in philosophical or intellectual contexts to describe a state of unawareness or a general ignorance about a particular subject.

Positive-Sum Bias: A positive-sum situation occurs when all parties involved in an interaction or transaction benefit, and the total gains outweigh the losses. In a positive-sum scenario, resources or value are increased, creating a "win-win" outcome where everyone's position is improved compared to where they started

Purchasing Power: refers to the ability of an individual or entity to buy goods and services with a specific amount of money. It indicates how much a unit of currency can buy in terms of goods and services. When purchasing power increases, it means you can buy more with the same amount of money, while a decrease in purchasing power means that the same amount buys less.

Redistributive: In economics, "redistributive" refers to policies or actions that aim to reallocate wealth, income, or resources from one segment of society to another, usually with the goal of reducing economic inequality. These measures are often implemented through government interventions such as taxation, welfare programs, social security, and public services.

Social Safety Nets: Social safety nets are government-led programs designed to protect individuals and families from economic hardship, particularly during times of crisis, unemployment, or poverty. These programs provide financial assistance or in-kind support to help people meet basic needs like food, shelter, and healthcare. Social safety nets aim to reduce poverty, prevent long-term hardship, and promote social stability by ensuring that vulnerable populations have access to a minimum standard of living.

Thermal energy: Thermal energy is energy that comes from a substance whose molecules and atoms are vibrating faster due to a rise in temperature.

Zero-Sum Bias: Zero-sum bias is the belief that for one person to gain something, another person must lose something. It's like thinking there's a fixed pie, and if someone takes a bigger slice, there’s less left for everyone else. This mindset ignores the possibility that the "pie" can grow, and that both people could benefit without anyone losing

Glossary

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