GCSE ECON PAPER 2 CONTENT Flashcards
(20 cards)
What is economic growth
An increase in the amount of goods and services produced in an economy over a period of time and so the growth over time of GDP
What is GDP
The total value of all goods and services produced in a country in a year
What is economic growth a result of
The output created by the factors of production
What are a few determinants of economic growth
Investment- increasing expenditure into capital which increases production
Changes in technology- increase efficiency, quality and output
Education and training- better educated people are more productive
Size of the workforce-
Natural resources- the availability of natural resources to exploit can aid growth
government policies- they can affect the market forces by incouraging more or less economic growth
Benefits of economic growth
A rise in material living standards due to GDP per capita increase
Unemployment goes down so people can earn
The government receives an increased tax, the government can use this to improve people in poverty (an increase in benefits)
An increase in welfare, people in education create more skilled workers and therefore further economic growth
costs of economic growth
environmental costs -, noise, air pollution, can lead to people being sick and so they rely and strain healthcare systems
globally warming
congestion- more people on the roads which can lead to poor access to facilities and overcrowding
loss of non renewable resources
SOCIAL
lower quality of life- increased success and growth in their job might mean they spend a lot of time away from their home
ECONOMIC
inequalities of wealth and income
inflation- more demand leads to a rise in goods overtime
What is unemployment
When someone who is willing and able to work at the current wage rates is still unable to find a job.
What are the two measures used to measure unemployment
Claimant count
Labour force survey
How does the claimant count work
It measures the number of people who are receiving unemployment-related benefits
What’s the difference between claimant count and labour force survey
Claimant count measures people who are claiming unemployment related benefits but labour force survey measures people actively looking for work (even if they’re not claiming benefits)
claimant count is easy to collect
labour force survey is more accurate
What are the four types of unemployment
seasonal
frictional
structural
cyclical
frictional unemployment
They have left one job and not yet started another
structural unemployment
It occurs when an industry goes into decline so they become unemployed as a result
cyclical unemployment
Happens when demand is falling and it leads to a cyclical structure
causes of unemployment
Lack of demand in the economy
Industries closing
jobs that only exists in certain seasons
benefits of unemployment
high unemployment keeps wage rates low as more people are looking for jobs, this is good for firms
costs of unemployment
PEOPLE
lower standard of living
lead to social effects like addiction and bad relationships
excluded workers (loose motivation and stop looking for a job)
GOVERNMENT
lower tax revenue
higher spending on benefits
REGIONS
depressed areas as low GdP
crime rates may rise
What is income
A flow of money over time received for providing the services of the factors of production
What is wealth
The store of assets that an individual company or country possesses at a certain point in time
What causes distribution in income and wealth
Education and skills
ownership of assets
employment status
government tax and benefits
