Term
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Definition
| th upward or downward movement of economic activity, or real GDP, that occurs around the growth trend |
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Term
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Definition
| generally favor non-activist policies |
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Term
| Consumer Price Index (CPI) |
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Definition
measures the price of a fixed basket of goods rather than measuring the prices of all goods |
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Term
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Definition
| unemployment caused by the institutional structure of an economy; ups and downs of economic activity/business cycle |
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Term
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Definition
continuous decline in price level * associated with depressions |
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Term
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Definition
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Term
| Employment-population ratio |
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Definition
| the number of people who are working as a percentage of people available to work |
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Term
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Definition
| an upturn that lasts at least two consecutive quarters of a year |
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Term
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Definition
| inflation people expect to occur |
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Term
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Definition
| (gross domestic product deflator) an index of the price level of aggregate output or the average price of the components in GDP relative to a base year |
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Term
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Definition
when inflation hits triple digits-100 percent or more per year |
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Term
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Definition
| a continual rise in the price level |
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Term
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Definition
| generally favor activist government policy; focus on cyclical and structural unemployment |
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Term
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Definition
| those people in an economy who are willing and able to work |
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Term
Labor Force Participation Rate LFPR=Civilian Labor Force X 100 Potential Labor Force |
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Definition
| measures the labor force as a percentage of the total population at atleast 16 years old |
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Term
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Definition
| the total amount of goods and services produced measured at current prices |
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Term
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Definition
states that 1 percentage point change in the unemployment rate will be associated with a 2 percent change in output in the opposite direction +1 percentage point change in unemployment-> -2 percent change in output |
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Term
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Definition
| real GDP divided by the total population |
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Term
| Personal Consumption Expenditure (PCE) deflator |
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Definition
| a measure of prices of goods that consumers buy that allows yearly changes in the basket of goods that reflect actual consumer purchasing habits |
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Term
Sources of Economic Growth |
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Definition
- supply side
- technological change and development
- capital accumulation
- increase in the availability of resources
- growth- compatible insitutions
- entrepreneurship
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Term
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Definition
inflation-fee level of production; the target rate of economic growth |
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Term
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Definition
| a number that summarizes what happens to a weighted composite of prices of a selection of goods over time |
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Term
| Producer Price Index (PPI) |
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Definition
measures price change from the perspective of the sellers and includes many goods that most consumers do not purchase |
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Term
| Real Gross Domestic Product (real GDP) |
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Definition
the market value of final goods and services produced in an economy, stated in the prices of a given year Real GDP is GDP adjusted for price changes |
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Term
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Definition
the total amount of goods and services produced, adjusted for price-level changes. The measure of output that would exist if the price level had remained constant. |
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Term
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Definition
| a decline in a real output that persists for more than two consectutive quarters of a year |
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Term
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Definition
| unemployment cause by the institutional structure of an economy or by economic restructuring making some skills obsolete |
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Term
| Target Rate of Employment |
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Definition
the lowest sustainable rate of unemployment that policy makers believe is achievable under existing conditions |
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Term
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Definition
| the percentage of people in the economy who are willing and able to work but who are not working |
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Term
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Definition
inflation that surprises people |
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Term
| Benefits of Economic Growth |
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Definition
- allows everyone in society to have more
- allows governments to avoid hard distributional questions
- generates jobs
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Term
| Costs associated with rapid economic growth |
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Definition
| pollution, resource exhaustion, and destruction of natural habitat |
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