Macro 1 Flashcards
(17 cards)
What is economic growth?
It is the increase of production of goods and services in an economy such as labour force capital goods and human capital
What is GDP?
Gross domestic product is the value of all services and goods of a country in a specific time period. It is used to estimate the size of an economy and can be used to predict further economic growth.
How do you calculate GDP?
GDP=consumption +investment + government spending + net exports
What is GDP per capita?
GDP per capita is a way of measuring the average output per person, a country with a high GDP per capita is considered very rich.
What is inflation?
Inflation is the rate at which the prices for goods and services increase which affects the purchasing power of the consumer.
How do you calculate inflation?
Using CPI this shows how the prices have changed each year
In terms of inflation what does real mean?
This is the price that has been adjusted to inflation
In terms of inflation what does nominal mean?
This is the price that hasn’t been adjusted for inflation
What causes inflation?
When there is too much money and not enough products
What is unemployment?
It is someone above the age of 16 and is jobless but they are able and available for work and actively seeking a job
What are the 4 types of unemployment?
Frictional
Structural
Cyclical
Seasonal
What is claimant count?
The amount of people who claim unemployed benefits.
What is the labour force survey?
Unemployment is estimated through measuring as the persons self classification as being out of work but currently looking for a job
What is the balance of payments?
The statement of all transactions made between entities in one country and the rest of the world over a defined period of time. A countries trade balance tells us whether is saves enough to pay for its imports. It also reveals if the country produces enough economic output to pay for its growth.
How do you calculate balance of trade?
Balance= export goods -import goods +export services -import services
How do you calculate labour productivity?
=gross domestic product/the total number of hours worked or total employment
What is labour productivity?
It is how efficient the labour in a economy is, it is directly linked to economic growth
