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Flashcards in Chapter 12 Deck (27)
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1
Q

National income accounting

A

System collects macroeconomic statistics on production, income, investment, and savings

2
Q

Gross domestic product (GDP)

A

Dollar value of final goods and services produced winthin a country’s borders in a given year

3
Q

Intermediate goods

A

Goods used in the production of final goods

4
Q

Durable goods

A

Goods last for a relatively long time such as refrigerators, cars, and DVD players

5
Q

Nondurable goods

A

Goods that last a short period of time such as food, light bulbs, and sneakers

6
Q

Nominal GDP

A

Measured in current prices

7
Q

Real GDP

A

Expressed in constant, or unchanging prices

8
Q

Gross national product (GNP)

A

Annual earned income earned by U.S. - owned firms and U.S. citizens

9
Q

Depreciation

A

Loss of value of capital equipment that results from normal wear and tear

10
Q

Price level

A

Average of all prices in the economy

11
Q

Aggregate supply

A

Total amount of goods and services in the economy available at all possible price levels

12
Q

Aggregate demand

A

Amount of goods and services in the economy that will be purchased at all possible price levels

13
Q

Business cycle

A

Period of macro economic expansion followed by a period of contraction

14
Q

Expansion

A

Period of economic growth as measured by a rise in real GDP

15
Q

Economic growth

A

Steady, long term increase in real GDP

16
Q

Peak

A

Height of an economic expansion, when real GDP stops rising

17
Q

Contraction

A

Period of economic decline marked by falling real GDP

18
Q

Trough

A

Lowest point in an economic contraction when real GDP stops falling

19
Q

Recession

A

Prolonged economic contraction

20
Q

Depression

A

A recession that is especially long and severe

21
Q

Stagflation

A

Decline in real GDP combined with a rise in the price level

22
Q

Leading indicators

A

Key economic variables that economists use to predict a new phase of business cycle

23
Q

Real GDP per capita

A

Divided by the total population

24
Q

Capital deepening

A

Process of increasing the amount of capital per worker

25
Q

Saving

A

Income not used for consumption

26
Q

Savings rate

A

Proportion of disposable income that is saved

27
Q

Technological progress

A

Increase in efficiency gained by producing more output without using more input