question
Economics
answer
Choices made under conditions of scarcity
question
Factors of Production
answer
Things that produce: Land, Labor, Capital
question
Land
answer
All the attributes of the Earth, including mineral, water, and air
question
Labor
answer
All the attributes of humankind: strength, intelligence, etc.
question
Capital
answer
Factories, tools, machinery
question
Macroeconomics
answer
The study of aggregate behavior
question
Microeconomics
answer
The study of individual behavior
question
Laissez Faire
answer
Polices of limited government interference in economic activities
question
Adam Smith
answer
The author of The Wealth of Nations in 1776
question
The Wealth of Nations
answer
Wrote by Adam Smith in 1776
question
The Great Depression
answer
A very large and lengthy downturn in economic activity lasting from 1929-1939 in the US
question
John Maynard Keynes
answer
Author of The General Theory in 1936
question
The General Theory
answer
Wrote by John Maynard Keynes in 1936
question
Demand
answer
The various quantities of a specific good consumers are willing and able to purchase at various prices
question
Law of Demand
answer
As the price increase, the quantity demanded decreases
question
Normal good
answer
as income increase, the demand for the good increases
question
Inferior good
answer
as income increases, the demand for the good decreases
question
Substitute
answer
A good which can be used as an alternate to another good
question
Complement
answer
Goods used together as a package
question
Ceteris Paribus conditions
answer
Everything else held constant
question
Supply
answer
The various quantities of a good producers are willing and able to sell at various prices
question
Equilibrium
answer
A situation from which there is no tendency for change
question
Shortage/excess demand
answer
When the quantity demanded exceeds the quantity supplied at the prevailing prices
question
Surplus/excess supply
answer
When the quantity supplied exceeds the quantity demanded at the prevailing prices
question
Gross Domestic Product
answer
Market value of all final goods and services produced domestically in a year
question
Gross National Product
answer
Market value of all final goods and services by domestically owned factors of production in a year
question
Personal Consumption Expenditures
answer
Purchases of final goods and services by consumers
question
Gross Private Domestic Investment
answer
Purchases of final goods and services by businesses
question
Durable Good
answer
A good which lasts longer than 3 years
question
Non-durable Good
answer
A good which last less than 3 years
question
Change in inventories
answer
The difference between the inventory at the beginning and end of the year
question
Government Consumption and Gross Investment
answer
The purchases of final goods and services by government at all levels
question
Transfer payments
answer
A payment given where no goods or services is provided in exchange
question
Net exports
answer
Exports- imports
question
Exports
answer
Foreign purchases of domestic goods
question
Imports
answer
Domestic purchases of foreign goods
question
Nominal GDP
answer
Measures GDP in the current year using prices from the current year
question
Current Dollar GDP
answer
Measures GPD in the current year using prices the current year
question
Real GDP
answer
Measures GPD in the current years using prices from a base year
question
Constant dollar GDP
answer
Measures GDP in the current year using prices from a base year
question
Chained Method (of calculating RGDP)
answer
Uses a geometric average of consecutive year prices to measure real GDP
question
Business Cycle
answer
The fluctuations in economic activity the economy goes through
question
Peak
answer
The point of the business cycle when economic activity is at its highest level
question
Trough
answer
The point of the business cycle when economic activity is at its lowest level
question
Recession
answer
When output decreases and unemployment increases across multiple sectors of the economy
question
Expansion
answer
When output increase and economic activity rises and eventually unemployment falls
question
National Bureau of Economic Research
answer
An association of academic and business economists who determine the start and end dates for US recessions
question
Fiscal policy
answer
Government control of its spending and taxation
question
Monetary policy
answer
Government control of the money supply
question
Inflation
answer
An increase in the average level of prices
question
Consumer price index
answer
Measures changes in the cost of a market basket of goods for the typical urban consumer
question
GDP Deflator
answer
Measures changes in the prices of all final goods and services produced domestically
question
Implicit Price Deflator
answer
Measures changes in the prices of all final goods and services produced domestically
question
Average level of prices
answer
an aggregation of price of goods and services to measure inflation
question
Relative Price
answer
The price of an item, keeping all other prices constant
question
Pure inflation
answer
prices of all goods and services change by the same percentage
question
Purchasing power
answer
How much a given amount of money allows you to buy in terms of goods and services
question
Nominal interest rate
answer
the percentage change in the amount of money lend and repaid
question
Real interest rate
answer
the percentage change in the purchasing power of money lent and repaid
question
Fisher Equation
answer
i = r + inflation^e
question
COLA Clause
answer
"Cost of living adjustment" ties a monetary payment in a contract to an agreed upon rate of inflation
question
Labor force
answer
individuals at or over 16 who are willing and able to work
question
Unemployment rate
answer
individuals at or over 16 who are willing and able to work and are unable to find a job
question
Frictional unemployment
answer
unemployment due to re-entrance and new entrance in into the labor force, also job quitter
question
Structural uemployment
answer
unemployment due to workers having the wrong skills or being in the wrong location for the available jobs
question
Cyclical unemployment
answer
unemployment due to downturns in economic activity
question
Natural rate of unemployment
answer
When there is no cyclical unemployment, there's only frictional and structural unemployment
question
Full-employment level of output
answer
The level of output when the level of unemployment is at the natural rate
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
