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capitalism > big > Flashcards

big Flashcards

1
Q

business cycle

A

periodic fluctuations in economic activity, measured by changes in real GDP growth rate

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2
Q

gross domestic product

A

market value of aggregate output produced within a country during a given time period

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3
Q

gross national income

A

value of all final g&s produced by FoP of the country’s residents, regardless of location

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4
Q

real

A

GDP measured in terms of prices of a base year and has eliminated the influence of changes in price

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5
Q

nominal

A

GDP measured in terms of current prices and does not account for changes in price

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6
Q

per capita

A

correspond to each person in the population on average

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7
Q

living standard

A

degree of wealth, material comfort & necessities available to a person

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8
Q

welfare

A

the physical and mental happiness of a person
refers to a range of gov programmes that provide financial or other aid to individuals or groups who cannot support themselves

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9
Q

aggregate demand

A

total quantity of real GDP that all buyers in an economy are willing & able to buy at different general P levels over a particular time period, ceteris paribus

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10
Q

consumer confidence

A

how optimistic consumers are about their future income and the future of the econ

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11
Q

business confidence

A

how optimistic firms are on their future sales and econ activities

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12
Q

aggregate supply

A

total quantity of real GDP produced in an economy at different general price levels over a time period, ceteris paribus

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13
Q

short run aggregate supply

A

relationship between gen P levels and Q of real outputs produced by firms when resource P no change

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14
Q

long run aggregate supply

A

relationship between gen P levels and Q of real outputs produced by firms when resource P is flexible & changes along with changes in gen P levels

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15
Q

full employment output

A

level of output measured by real GDP when all productive resources are fully and efficiently used
unemployment is at NRU

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16
Q

inflation

A

sustained increase in general price level

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17
Q

inflationary gap

A

real GDP&raquo_space;> Yp
excess AD → unemployment «< NRU
firms require more labour → excess demand of labour → over-utilised

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18
Q

deflation

A

sustained decrease in general price level

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19
Q

deflationary gap

A

real GDP «< Yp
insufficient AD → unemployment&raquo_space;> NRU
firms require less labour → excess supply of labour → under-utilised

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20
Q

unemployment

A

people of working age who are willing and able to work and are actively seeking work but are without work at the current wage rate

21
Q

frictional unemployment

A

occurs when workers are moving in between jobs

22
Q

seasonal unemployment

A

occurs when workers are unemployed due to seasonal fall in labour demand in the industry

23
Q

structural unemployment

A

mismatch between the worker’s skills supplied & jobs available

24
Q

cyclical unemployment

A

occurs when the economy produces at an output level that is lower than Yp at deflationary rate

25
Q

natural rate of unemployment

A

frictional unemployment + structural unemployment + seasonal unemployment

26
Q

consumer price index

A

measure of cost of g&s purchased by the typical household in an economy

27
Q

weighted price index

A

an approach to calculating the change in the price level by giving a weight to each item according to its importance in the consumers’ budgets

28
Q

disinflation

A

a fall in the rate of inflation

29
Q

demand-pull inflation

A

sustained increase in general price level caused by an increase in AD

30
Q

cost-push inflation

A

sustained increase in general price level caused by an increase in CoP resulting in a decrease in SRAS

31
Q

bad deflation

A

deflation caused by decrease in AD

32
Q

good deflation

A

deflation caused by increasing in SRAS

33
Q

economic growth

A

increase in real GDP of an economy over a time period

34
Q

actual economic growth

A

previous unemployed/underemployed FoP are brought into production

35
Q

potential economic growth

A

increase in quantity & quality of FoP that increases the maximum production capacity

36
Q

productivity

A

the efficiency with which a country combines capital and labour to produce more with the same level of factor inputs

37
Q

interest rate

A

rate at which borrowers are charged or lenders paid for their loan

38
Q

monetary policy

A

carried out by the central bank by changing the interest rate to adjust AD to maintain low unemployment and price stability

39
Q

fiscal policy

A

manipulations by the gov of its own tax & expenditure to adjust AD to maintain low unemployment and price stability

40
Q

expansionary

A

increase in AD and real GDP

41
Q

contractionary

A

decrease in AD and real GDP

42
Q

supply-side policy

A

aim at positively affecting production side of econ by improving institutional framework and capacity to produce

43
Q

market-based supply side policy

A

make institutional changes such that the market operates more freely and is more competitive with less government intervention

44
Q

privatisation

A

a type of supply-side policy where the government sells public assets to the private sector

45
Q

deregulation

A

a type of supply-side policy where the government reduces the number or type of regulations governing the behaviour of firms

46
Q

labour market reforms

A

make the markets more responsive to supply and demand so that the level of employment will increase and productivity will rise

47
Q

labour union

A

an organisation of workers whose goals include the improvement of working conditions and payments to workers
work on behalf of workers through negotiations (collective bargaining) with management

48
Q

interventionist supply side policy

A

government take an active role in increasing productive capacity

capitalism (4 decks)

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