a Flashcards
a (16 cards)
What are the four phases of the business cycle?
Expansion, Peak, Contraction, Trough
The business cycle represents the fluctuations in economic activity over time.
What is the difference between a recession and a depression?
Recession is a short-term downturn, depression is severe and long-lasting.
A recession typically lasts for a few months, while a depression can last for several years.
At which phase is the economy considered ‘overheated’?
Peak
At this stage, economic growth is at its highest, often leading to inflation.
What phase has the highest unemployment?
Trough
During this phase, economic activity is at its lowest, leading to job losses.
What is frictional unemployment?
Unemployment due to people transitioning between jobs.
This type of unemployment is usually short-term and voluntary.
How is the unemployment rate calculated?
(Unemployed / Labor Force) × 100
This formula gives the percentage of the labor force that is unemployed.
What is the natural rate of unemployment?
The sum of frictional and structural unemployment.
It reflects the long-term rate of unemployment in an economy.
What does the labor force include?
All employed and unemployed individuals actively seeking work.
It does not include those not seeking employment.
What is inflation?
A sustained rise in the general price level.
It erodes purchasing power over time.
What is deflation?
A sustained fall in the general price level.
It can lead to reduced consumer spending and economic stagnation.
What is CPI?
Consumer Price Index; measures the average change in prices over time for a fixed basket of goods.
CPI is a common indicator of inflation.
How is the inflation rate calculated?
[(CPI this year - CPI last year) / CPI last year] × 100
This calculation shows the percentage change in prices from one year to the next.
What is primary data?
Data collected specifically for the current research project.
It is original data tailored to meet the specific needs of a study.
What is a focus group?
A moderated group discussion to explore opinions and feelings.
It is often used in market research to gain insights.
What is a depth interview?
A one-on-one unstructured interview to explore motivations.
This method allows for in-depth understanding of individual perspectives.
What are projective techniques?
Indirect methods to uncover hidden thoughts and feelings, e.g., word association.
These techniques help researchers gain insights that might not surface through direct questioning.
