Economy

Interlinked Thematic Vocabulary Unit Nº 323 v.01

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1. bankruptcy |legal| |n| a legal procedure for liquidating a business (or property owned by an individual) which cannot fully pay its debts out of its current assets. Bankruptcy can be brought upon itself by an insolvent debtor (called 'voluntary bankruptcy') or it can be forced on court orders issued on creditors' petition (called 'involuntary bankruptcy'). Two major objectives of a bankruptcy are (1) fair settlement of the legal claims of the creditors through an equitable distribution of debtor's assets, and (2) to provide the debtor an opportunity for fresh start. Bankruptcy amounts to a business-failure, but voluntary winding up does not.
2. "The company was forced into bankruptcy."
3. "The number of bankruptcies was especially high last year."
4. "Critics view the decision as an example of moral bankruptcy on the part of the administration."
5. budget |n| an estimate of income and expenditure for a set period of time.
6. inflation |n| the rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling. Central banks attempt to limit inflation — and avoid deflation — in order to keep the economy running smoothly.
7. interest rate |n| the amount of interest that must be paid. It is expressed as a percentage of the amount that is borrowed or gained as profit.