Chapter 2- Government Economic Policy Objectives Flashcards
(6 cards)
1
Q
Define
Economic growth
A
In the short run, an increase in real GDP, and in the long run, an increase in productive capacity, that is, in the maximum output that the economy can produce.
2
Q
Define
Unemployment
A
A situation where people are out of work but are willing and able to work.
3
Q
Define
Labour force
A
The people who are employed and unemployed, that is, those who are economically active.
4
Q
Define
Economically inactive
A
People of working age who are neither employed nor unemployed.
5
Q
Define
Deflation
A
A sustained fall in the general price level
6
Q
Define
Balance of payments
A
A record of money flows coming in and going out of a country.
