Term
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Definition
| #employed plus #unemployed |
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Term
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Definition
| #unemployed/labor force X100 |
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Term
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Definition
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Term
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Definition
| an unemployed person who gives up looking for work. therefore this person is no longer in the labor force. |
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Term
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Definition
| frictional, structural, cyclical |
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Term
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Definition
| temporary, voluntary,-takes time to look for job that a person wants |
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Term
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Definition
| replaced by automation, no longer in demand, involuntary,-number of jobs in market is insufficent |
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Term
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Definition
| due to changes in production over the business cycle, involuntary |
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Term
| how much employment is full employment (FE)? |
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Definition
| a situation in which there is no cyclical unemployment-about 4-6% unemployment or about the level of fricational + structural |
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Term
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Definition
| what the output could be if at FE |
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Term
| 3 reasons of natural rate |
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Definition
1. unions- W go up, E goes down
2. min wages- Wmin > Wequilibrium Edown
3. efficiency wage W > Wequilibrium |
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Term
| Gross domestic production |
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Definition
| the market value of all final goods and services produced within a country in a given period of time |
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Term
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Definition
| the market value of all final goods and services produced by permanent residents of a nation |
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Term
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Definition
| total ammount spent by consumers on a newly produced goods and services (excluding new homes, which are considered investment goods) |
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Term
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Definition
| sum of all the expenditures of businesses firms on new plant and equipment, plus expenditures on new homes |
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Term
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Definition
| all goods and services purchases by all levels of government |
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Term
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Definition
| difference between what we sell to foreigners and what we buy from them (X-M) |
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Term
| GDP=Y=total ammount on final goods and services, Y=C+I+G+NX |
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Definition
| GDP=Y=sum of all incomes earned Y=w+r+i+profit (excludes transfer payments) |
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Term
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Definition
| value of all output at current prices |
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Term
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Definition
| GDP at constant prices. it is a measure of the economy production of goods and services holding prices constant |
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Term
| growth in economy (triangleQ) |
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Definition
| (real GDP1-real GDP2)/real gdp0 X 100 |
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Term
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Definition
| a measure of the price level calculated as nominal GDP/real GDP X 100. tells us the increase in the normal GDP due to increases in prices rather than a increase in quantity produced |
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Term
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Definition
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Term
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Definition
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Term
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Definition
| Real GDP1-Real GDP0/real GDP X100 |
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Term
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Definition
1.Substitution bias
2.introduction of new goods
3.unmeasured quality changes |
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Term
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Definition
| the interest rate without a correction for the effects of inflation. nominal=real+expected inflation rate |
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Term
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Definition
| the interest rate corrected for the effect of inflation. it is the opportunity cost of borrowing money. |
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Term
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Definition
discourages-savings, investors
encourages-borrowing, spending |
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Term
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Definition
| group of institutions the economy that help to match one person's saving with another person's investment |
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Term
| nominal=real+expected inflation |
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Definition
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Term
| economic growth and public policy |
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Definition
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Term
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Definition
| financial institutions through which savers can directly provide funds to borrowers |
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Term
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Definition
| is a certificate of indebtedness that specifies the obligation of the borrowers to the holder of the bond |
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Term
| 3 characteristics of bonds |
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Definition
1.term-longer term & higher rate
2.risk-junk bond-one that doesnt pay off, risky (3rd world country)
3.tax treatment- no fed tax? |
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Term
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Definition
ownership in a firm, therefore a claim to the profits that the firm makes
1. equity finance
2. higher risk and potentially higher returns
3.supply and demand for the stock determine its price |
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Term
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Definition
| financial institutions through which savers can indirectly provide funds to borrowers |
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Term
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Definition
a selection or portfolio of various types of stocks bonds or both stocks and bonds
1.diversity
2.specialization |
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Term
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Definition
| the market in which those who want to save supply funds and those who want to borrow to invest demand funds |
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Term
| 3 government policies that affect the economy's savings and investment |
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Definition
1.taxes and savings
2.taxes and investment
3.government budget deficits
an increase in the budget defict drives investment spending down |
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