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Naked Short Selling – a type of short selling where the trader chooses not to borrow (or arrange to borrow) securities before exchanging them. In many areas this practice is illegal. It has been against the law in the US since 2008.

Narrow Money – the most liquid forms of assets, i.e. they can immediately be used for transactions and commerce. Includes coins, notes, travelers checks, and checking accounts in banks. Also known as M1 (M0 in the UK).

Nash Equilibrium – a concept in game theory where the game’s best outcome is one where none of the players has an incentive to veer from his or her chosen strategy after considering all the choices available to other members of the group. The player cannot receive any incremental benefit by changing plans, assuming that all the other players keep to their strategies. A game may have just one Nash equilibrium, several, or none.

National Debt – the total amount borrowed (total outstanding borrowings) by a central government and all local authorities within a country. The national debt includes what the government owes foreign creditors – external debt – and its national creditors – internal debt. Also know as the Sovereign Debt, Public Interest, and Government Debt.

Nationalization – when a government or state becomes the owner of a private industry or controls private assets. This can occur for several reasons, such as a socialist government taking over certain sectors of the economy, or the taxpayer bailing out collapsing banks.

Nation-Building – refers to either 1. Getting a failed state to function properly again. 2. Help a country or region get back on its feet after a war. 3. Government policies aimed at encouraging a strong sense of national identity. In South Africa, it refers to the advocacy of national solidarity that emerged in the country after the apartheid era. The most successful nation-building program in history was the Marshall Plan, which helped speed up Europe’s recovery after WWII.

Natural Monopoly – a monopoly that exists because a particular market’s economies of scale make it the most cost-effective solution and the best deal for consumers. If several companies operated in that market, prices would be higher and quality might be affected. The provision of water, for example, requires a massive infrastructure investment – having two companies laying down two separate pipelines for the same end users would not make economic sense.

Natural Rate of Unemployment – that rate of unemployment at which inflation does not fluctuate – it neither accelerates nor decelerates. When an economy is at the natural rate of unemployment, inflation is constant over each 12-month period. Employers and employees come to expect this annual inflation rate and base their decisions on it. That is why it is often called the constant inflation rate of unemployment or the non-accelerating inflation rate of unemployment.

Near Money – assets that are not as liquid as money, but can be converted into cash rapidly, such as short-term money market instruments and bank deposits. Also called quasi-money.

Negative Income Tax – a system in which people on low incomes or no income receive supplemental pay from the government instead of paying taxes. In the US it is known as Earned Income Tax Credit, and Working Tax Credit in the UK. It is said to have less stigma attached to it than other forms of welfare financial help.

Negotiable – refers to something that can be transferred to another individual or entity as a form of payment, or sold on. Negotiable instruments, such as banknotes, bills of exchange and promissory notes are documents that guarantee the payment of a specific amount of money, either immediately (on demand) or at a future date, with the payer named on the document. Negotiable also means that the sale price might be reduced, or the terms of a contract or agreement could be adjusted.

Negotiable Instrument – a written document where the payer guarantees the payment of a specified amount of money, to be paid either on demand or at a future time. The payer promises payment without condition. Examples include banknotes, checks, bills of exchange, demand drafts, promissory notes and certificates of deposit.

Neo-classical Economics – can also be written without the hyphen (neoclassical economics). It is a school of economics, a theory, that believes that the consumer is ultimately the driver of price and demand, because the consumer’s goal is utility maximization (customer satisfaction), while that of the company is profit maximization.

Net Asset Value (NAV) – the value of a company’s total assets minus the value of its liabilities. This might also be the same as the book value or equity value of a business.

Net Income – also known as net profit or net earnings, net income is income after paying for the cost of goods sold, expenses, taxes, as well as depreciation. The term may refer to businesses as well as individuals.

Net Profit – a business’, person’s or entity’s total sales (revenue) minus all its expenses. In the UK it might not take into account taxes paid, while in the US it nearly always does. Net Profit is part of an income statement, which covers an accounting period of either one month, one quarter, six months, or one year. Also known as net income, net earnings or the bottom line.

Network Effect – the effect that an individual user of a good or service has on its value to other subscribers or users. When a network effect exists, the product or service’s value depends on how many people are using it. Also called demand-side economies of scale and network externality.

Net Worth – the value of an entity (be it a person, company, or other organization). Net worth equals assets minus liabilities.

Neural Networks – sets of algorithms that have been modeled after the human brain. The algorithms have been designed to recognize patterns. An neural network is an example of machine learning, which is part of AI (artificial intelligence).

Neutrality of Money – also called neutral money or monetary neutrality, is an economic theory that says that changes in the money supply make no difference to GDP and the basic structure of the economy. If you double the money supply, everything will rise, including wages, prices, etc. If they all increase by the same proportion, then nothing really has changed. The real economy (real variables), including total employment and total output remain the same.

New Economy – a term some economists and journalists began using during the last two decades of the last century. They believe that the Internet, state-of-the-art information technology, other hi-tech, and globalization have created a completely new kind of economy – one that does not follow the rules that existed in the old economy. In the new economy, productivity is considerably greater, as are growth rates, and inflation is virtually non-existent, they say.

New Money – wealth that was not inherited; it was created during the lifetime of the individual. The opposite of old money. A derogatory term for new money is nouveau riche.

Niche market – a very focused market with demand for a specialized product or commodity. It is typically a small subset of a larger market.

Nobel Prize for Economics – seen as the most prestigious award globally in the field of economics. Officially called the Nobel Memorial Prize in Economic Sciences, and often referred to as the Swedish National Bank’s Prize in Economic Sciences in Memory of Alfred Nobel. The Swedish National Bank, the country’s central bank, pays the $1 million annual prize money.

Node – in a blockchain, a node is a computer that connects to the network. It supports the network through validation and relaying transactions. Each node, during a transaction, gets a copy of the full blockchain. There are different types of nodes, such as full and lightweight nodes.

Nominal Price – an asset’s ‘estimated’ price that does not always accurately reflect the market price of an asset (as it does not change based on inflation).

Nominal Value – the value of something expressed simply in the money of the day. Nominal figures are misleading because they do not take into account inflation. ‘Real value’ factors in the inflation effect. If a bag of sugar cost $5 in 2010 and $5 in 2016, its nominal value was the same. However, if average annual inflation over those six years was 1.2%, the real value of a bag of sugar declined.

Non-Disclosure Agreement – a confidentiality contract that parties in a meeting or presentation sign so that sensitive information remains a secret. It is also known as an NDA or ‘confidentiality agreement’. There are two types of NDAs, one-way or mutual.

Non-Participating Preferred Share – shares that only pay a fixed rate of interest and have a limit on how much can be paid out in dividends each year. The dividends are not proportional to the company’s profits. Holders of these shares get their money before common stockholders do.

Non-Performing Loan – when payments on interest and principal are overdue for more than 90 days it is a non-performing loan. It is likely (but not certain) the borrower will not be able to pay back the debt.

Non-Price Competition – marketing campaigns carried out by companies that do not involve altering the price of their products or services. Rivals may focus on providing extra services, inviting consumers to join a raffle or competition with a nice prize, improving the quality of their product, pointing out their excellent workmanship, etc. Non-price competition is more common in markets where there are very few competitors – oligopolies. The companies like to give the impression that they are competing aggressively, but they have probably colluded to keep their prices artificially high.

Non-Store Retailing – retailing that takes place outside a traditional brick-and-mortar (physical) location.

Nonprofit Organization – an organization whose purpose is other than making a profit. Nonprofit organizations typically focus on education, scientific research, scholarships, health, human rights, religious bodies, trades, professions, worker’s rights, etc. If you donate money to a nonprofit organization, in most cases your contribution is tax-deductible.

Normal Goods – includes all goods for which demand rises when incomes increase. Demand for normal goods always rises when incomes rise, but by a smaller amount – goods for which demand increases are matched or are greater than income growth rates are called luxury goods. Normal goods contrast with inferior goods, for which demand declines when income grows.

Normative Economics – a branch of economics that makes value judgments and looks at how things should be or should have been, rather than observing current or past facts. Normative economics contrasts with positive economics, which focuses purely on tested or proven facts. Normative economics expresses value regarding economic fairness, or what the economic goals or outcomes of policymakers ought to be.