chapter 10 vocab Flashcards
(25 cards)
Macroeconomists use measures such as national income and product accounts (NIPAs) to track production, income, and consumption of nation’s economy
national income accounting
most widely used NIPA - total dollar value of all final goods and services produced within a country during one calendar year
gross domestic product
used to commute GDP, economists add the output produced by four sectors of product market
output-expenditure model
consumer purchases
personal consumption expenditures
the total value of all capital goods produced in a given nation during one year as well as changes in the dollar value of business inventories
gross investment
current GDP - expressed in the current prices of the period being measured
nominal GDP
GDP adjusted for price changes
Real GDP
a set of statistics that allows economists to compare prices over time
price index
illegal activities and unreported legal activities
underground economy
measures the total dollar value of all final output produced with factors of production owned by residents of a county during one year
Gross National Product
fluctuations or changes in a market system’s economic activity
Business cycles
a period of economic expansion and growth
expansion
a high point, at which the economy is at its strongest and most prosperous
peak
when real GDP stops increasing, the business cycle enters a period of business slowdown,
contraction
a decline in real GDP for two or more consecutive quarter - 6 months or more
recession
a prolonged and severe recession
depression
final stage in business cycle, which occurs when demand, production, and employment reach their lowest levels
trough
anticipate the direction in which the economy is headed
leading indicators
change as the economy moves from one phase of the business cycle to another and tell economists that an upturn or a downturn in the economy has arrived
coincident indicators
change months after an upturn or a downturn in the economy ha begun and help economists predict the duration of economic upturns and downturns
lagging indicators
an increase in the real dollar value of all final goods and services that are produced per person for a specified period of time
Real GDP per capita
a measure of how much each worker produces in a given period of time, usually an hour
labor productivity
an increase in the output of each worker per hour of work
productivity growth
the amount of capital stock available per worker
capital-to-labor ratio
