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Macro
N/A
65
Economics
Undergraduate 2
02/02/2015

Additional Economics Flashcards

 


 

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Term
Economy
Definition
The structure of economy activity in a community, region , a country, a group of countries, or the world
Term
GDP
Definition
Market value of all final goods and services produced in the nation during a particular pd. Usually a year
Term
GWP
Definition
Market value of all final goods and services produced in the world during a particular pd. Usually a year
Term
Flow variable:
Definition
a measure of something over and interval of time, such as your spending per week
Term
stock variable:
Definition
a measure of something at a particular point in time, such as the amount of money you have with you right now
Term
mercantilism
Definition
the incorrect theory that a nation’s economic objective should be to accumulate precious metals in the public treasury, this theory prompted trade barriers to cut imports, but other countries retaliated reducing trade and the gains from specialization
Term
Expansion
Definition
A period during which the economy grows as reflected by rising output, employment, income, and other aggregate measures
Term
Contraction
Definition
A period during which the economy declines as reflected by falling output, employment, income, and other aggregate measures
Term
Depression:
Definition
A severe and prolonged reduction in activity as occurred during the 1930s
Term
Recession
Definition
A period of decline in economic activity lasting more than a few months, as reflected by falling output, employment, income, and other aggregate measures. Official measure is three months
Term
Inflation
Definition
Increase in economy’s avg price level
Term
Leading economic indicators:
Definition
Variables that predict, or lead to, a recession or recovery; examples include consumer confidence, stock market prices, business investment, and big ticket purchases, such as automobiles and homes
Term
Coincident economic indicators:
Definition
Variables that reflect peaks and troughs in economic activity as they occur; examples include employment, personal income, and industrial production
Term
Lagging economic indicators:
Definition
Variables that follow or trail changes in overall economic activity. Examples include the interest rate and the avg duration of unemployment
Term
aggregate output:
Definition
a composite measure of all final goods and services produced in an n economy during a given period: real GDP
Term
aggregate demand:
Definition
the relationship between the economys price level and the quantity of aggregate output demanded (other things constant)
Term
price level
Definition
a composite measure reflecting prices of all goods and services in the economy relative to prices in a base year
Term
real gross domestic product
Definition
the economys aggregate output measured in dollars of constant purchasing power
Term
aggregate demand curve:
Definition
a curve representing the relationship between the economys price level and real GDP demanded per period
Term
aggregate supply curve:
Definition
a curve representing the relationship between the economys price level and real GDP supplied per period (other things constant)
Term
Federal budget
Definition
a plan for fed government outlays and revenues of a specific period, usually a year
Term
Federal budget deficit
Definition
a flow variable that measures the amount by federal government outlays exceed federal govt revenues in a particular period, usually a year
Term
Demand side economics
Definition
macroeconomic policy that focuses on shifting the aggregate demand curve as a way of promoting full employment and price stability
Term
Fiscal policies
Definition
(government spending and taxes) and monetary policies
Term
Stagflation
Definition
a contraction or stagnation of a nations output accompanied by inflation in the price level
Term
Expenditure Approach to GDP
Definition
Calculating GDP by adding up spending on all final goods and services produced in the nation during the year
Term
Income approach to GDP
Definition
Calculating GDP by adding up all earnings from resources used to produced output in the nation during the year
Term
Final goods and services
Definition
Goods and services sold to final, or end, users
Term
Intermediate goods and services
Definition
Goods and service purchased by firms for further reprocessing and resale
Term
Double counting
Definition
The mistake of including both the value of intermediate products & the final value of final products in calculating GDP; counting the same production more than once
Term
Consumption
Definition
Household purchases of final goods and services, except for new residences, which count as investment
Term
Investment
Definition
The purchase of new plants, equipment, buildings, & residences plus net additions to inventories
Term
Physical capital
Definition
Manufactured items used to produce goods and services; include new plants and new equipment
Term
Residential construction
Definition
Building new homes or dwelling places
Term
Inventories
Definition
Producers stocks of finished and in process goods
Term
Government purchases
Definition
Spending for goods and services by all levels of government; govt outlays minus transfer payments
Term
Net exports
Definition
The value of a countrys exports minus the value of its imports
Term
Aggregate expenditure
Definition
Total spending on final goods and services in an economys during a given perod, usually a year
Term
Aggregate income
Definition
All earnings of resource suppliers in an economy during a given period, usually a year
Term
Labor force
Definition
Those 16 years of age and older who are either working or looking for work
Term
Unemployment rate
Definition
The number unemployed as a percentage of the labor force
Term
Discouraged workers
Definition
Those who drop out of labor force in frustration because they can’t find work
Term
Labor force participation rate
Definition
The labor force as a percentage of the adult population
Term
Long term unemployment
Definition
Those looking for work for 27 weeks or longer
Term
Frictional unemployment
Definition
Unemployment that occurs because job seekers and employers need time to find each other
Term
Seasonal unemployment
Definition
Unemployment caused by seasonal changes in the demand for certain kinds of labor
Term
Structural unemployment
Definition
Unemployment because 1) the skills in demand do not match those of the unemployed, or 2) the unemployed do not live where the jobs are
Term
Cyclical unemployment
Definition
Unemployment that fluctuates with the business cycle, increasing during contractions and decreasing during expansions
Term
Full employment
Definition
Employment level when there is no cyclical unemployment
Term
Unemployment benefits
Definition
Cash transfers for those who lose their jobs and actively seek employment
Term
Underemployment
Definition
Workers are overqualified for their jobs or work fewer hours than they would prefer
Term
Hyperinflation
Definition
A very high rate of inflation
Term
Deflation
Definition
A sustained decrease in the price level
Term
Disinflation
Definition
A reduction in the rate of inflation
Term
Demand pull inflation
Definition
a sustained rise in the price level caused by a rightward shift of the aggregate demand curve
Term
cost-push inflation
Definition
a sustained rise in the price level caused by a leftward shift of the aggregate supply curve
Term
interest
Definition
the dollar amount paid by borrowers to lenders
Term
interest rate
Definition
interest per year as a percentage of the amount loaned
Term
nominal interest rate
Definition
the interest rate expressed in current dollars as a percentage of the amount loaned; the interest rate on the loan agreement
Term
real interest rate
Definition
the interest rate expressed in dollars of constant purchasing power as a percentage of the amount loaned; the nominal interest rate minus the inflation rate
Term
COLA
Definition
Cost of living adjustments; the increase in a transfer payment or wage that reflects the increase in the price level
Term
Productivity
Definition
The quantity of goods and services produced from each unit of labor input
Term
Physical capital
Definition
The stock of equipment and structures that are used to produce gods and services
Term
Human capital
Definition
The knowledge and skills that workers acquire through education, training, and experience
Term
Natural resources
Definition
The inputs into the production of goods and services that are provided by nature, such as land, rivers, and mineral deposits
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