Term
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Definition
| a legally determined maximum price that sellers may charge |
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Term
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Definition
| a legally determined maximum price that sellers may receive |
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Term
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Definition
| the difference between the highest price a consumer is willing to pay for a good or service and the price the consumer actually pays |
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Term
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Definition
| The differecne between the lowest price a firm would be willing to accept for a good or service and the price it actually receives |
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Term
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Definition
| the sum of the consumer surplus and the producer surplus |
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Term
| Graph of Consumer and Producer Surplus |
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Definition
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Term
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Definition
the market value of all final goods and services produced in a country during a period of time, typically one year
GDP=C+I+G+(X-M)
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Term
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Definition
the market vale a firm adds to a product
(chart on pg 218) |
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Term
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Definition
| the value of final goods and services evaluated at current-year prices |
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Term
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Definition
| The value of final goods and services evaluated at base-year prices |
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Term
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Definition
a measure of the price leve, calculated by dividing nominal GDP by real GDP and multiply by 100
Nominal GDP
Real GDP x 100 |
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Term
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Definition
| tracks total production and total income in the economy |
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Term
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Definition
| Depreciation-GDP= National Income |
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Term
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Definition
| the sum of employment and unemployment workers in the economy |
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Term
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Definition
| people who are available for work but have not looked for a job during the previous four weeks because they believe no jobs are available for them |
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Term
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Definition
Number of Unemployed
Labor Force x 100 |
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Term
| Labor Force Participation Rate |
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Definition
Labor Force
Working-age population x 100 |
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Term
| Trends In Labor Force Participation |
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Definition
| the rate of men has declined gradually sicne 1948, but the rate of women has increased significantly, making the overall labor force participation rate higher today than 1948 |
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Term
| Different Types of Unemployment |
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Definition
Frictional
Structural
Cyclical |
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Term
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Definition
| short-term unemployment that people out of work or between two jobs |
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Term
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Definition
| people who were laid off because their skills have become obsolique. mismatch better skills and needs of ecnomy |
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Term
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Definition
unemployment caused by a business cycle recession.
when there is a contraction → employment goes down
when there is expansion→employment goes up |
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Term
| The Creating and Destruction of Jobs Result from: |
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Definition
| changes in consumer tastes, tech. progress, and the sucess and failures of entrepenuers in responding to the opprotunities and challenges of shifting consumer tastes and tech. change |
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Term
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Definition
| orgs. or workers that bargin with employers for higher wages and better working conditions for their memebers |
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Term
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Definition
| a measure of the average prices of goods and services in the economy |
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Term
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Definition
| the % increase in the price level from one year to the next |
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Term
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Definition
an average of the prices of goods and services purchases by the typical urban family of four.
tells us if cost of living increases |
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Term
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Definition
Expenditures in the current year
Expenditures in the base year x 100 |
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Term
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Definition
an average of the prices received by producers of goods and services at all stages of the production process
used to buy producers |
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Term
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Definition
| the stated interest rate on a loan |
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Term
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Definition
| nominal interest rate-inflation rate |
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Term
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Definition
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Term
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Definition
| the cost to firms of changing prices |
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Term
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Definition
rising productivity increases the average standard of living
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Term
| Two Key Factors Determine Labor Productivity |
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Definition
- quantity of capita per hour workerd
- level of technology
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Term
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Definition
| a system of finalncial markets and financial intermediaries through which firms acquire funds from housholds |
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Term
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Definition
| markets where financial securities, such as stocks and bonds are bought and sold |
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Term
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Definition
| firms such as banks, mutual funds, pension funds, and insurance companies that borrow funds from savers and lend them to borrowers |
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Term
| Market for Loanable Funds |
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Definition
| The interaction of borrowers and lenders that determine the market interest rate and the quantity of loanable funds exchanged |
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Term
| The Demand for Loanable Funds are Determined by: |
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Definition
| the willngness of firms to borrow money to engage in new investment projects |
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Term
| The Supply For Loanable Funds are Deteremined by: |
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Definition
| the willingness of households to save and by the extent of the govsaving or dissaving |
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Term
an increase in the demand for[image] loanable funds |
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Definition
| technological change increases the demand for loanable funds (d1→d2) →increasing the equilibrium interest rate (i1→i2) → and increasing the equilibrium quality of loanable funds (L1→L2) |
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Term
The Effect of a Budget Deficit on the Market for Loanable Funds
[image] |
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Definition
| when the gov. begins running a budget deficit, the supply o loanable funds is reduced (s1→s2) → increasing the equilibrium interest rate (i1→i2) →and decreasing the equilibrium quantity of loanable funds (q1→q2) |
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Term
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Definition
- household economic activity
- unreported income
- underground activity
- illegal activities
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Term
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Definition
- value of total production
- value of total income
- value added
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Term
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Definition
Land→rent
labor→wage
capital→interest
entrepenuer→profit |
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Term
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Definition
- comparing countries
- judge well being (welfare)
- leisure
- pollution
- crime
- distibution of income
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Term
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Definition
| price of money or financial capital |
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Term
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Definition
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Term
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Definition
expected
wage and price spiral
Price ↑ wage ↑ cost of production ↑ |
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Term
| Wage and Price Controls (freezes) |
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Definition
legislation that stops inflation
price cannot ↑
wage cannot ↑
for 6 months |
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Term
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Definition
| businesses can't plan because don't know what prices will be |
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Term
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Definition
| people buy less (demand ↓) →firms ↑ umplanned inventory→firms supply↓, will produce less outputs ( due to cyclical unemployment) →I ↓→people buy less→back to the begining |
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Term
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Definition
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Term
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Definition
| GDP that would have been produced if all resources were as productive as they could be |
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