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31 Cards in this Set
- Front
- Back
GDP (Gross Domestic Product)
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dollar value of all FINAL g/s produced WITHIN a country’s borders in a given YEAR
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Final goods
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products in the form sold to consumers
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intermediate goods
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used in the production of final goods
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Durable goods
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last for relatively long time
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nondurable goods
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last for short period of time (ie light bulbs)
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Nominal GDP
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GDP measured in current prices
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real GDP
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GDP expressed in constant prices
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GNP
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GDP plus income earned by outside US firms/citizens. Doesn’t include income made by foreign firms/countries located in US (unlike GDP)
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Depreciation
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loss of value of capital equipment that results from wear and tear
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Price level
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avg of all prices in an economy
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Aggregate supply
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total amount of g/s in an economy available at all possible price levels (like supply curve)
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Aggregate demand
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amount of g/s in the economy that will be purchased at all possible price levels
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Business cycle
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period of macroeconomic expansion followed by contraction period
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Expansion
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period of economic growth measured by GDP increase
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Economic growth
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steady, long term increases in GDP
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Peak
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height of economic expansion
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Contraction
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period of economic decline measured by falling GDP
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Recession
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2 quarters of declining GDP
declining demand declining prices increasing unemployment |
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Depression
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prolonged recession
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Stagflation
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declining GDP
increasing prices increasing unemployment |
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Leading indicators
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key economic variables economists use to predict a new phase of a business cycle (ie stock market, interest rates)
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Real GDP per capita
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real GDP divided by total population; best measure of nation’s standard of living; bt doesn’t show how evenly distributed
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Capital deepening
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process of increasing real GDP per capita
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Savings rate
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disposable income that’s saved
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Technological progress
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increase in efficiency gained by producing more output w/o using more inputs= higher real GDP per capita= higher standard of living
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National income accounting
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system that collects macroeconomic stats on production
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Describe 1973 OPEC
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stagflation
increased oil prices b/c US supported Israel. external shock |
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Keynesian economics
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John Maynard Keynes
govt should make jobs- overall, didn't really help FDR |
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Supply Side economics
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ex: Reagan, Thatcher
deregulate, reduce taxes |
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airlines 50s-80s
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govt controls airlines so all the same, stifling competition.
Regan deregulated, airlines went under+lost jobs, but more innovation and more started flying b/c cheaper. |
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calculating inflation rate
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