Macro Booklet 1

Question 1

Expenditure Method

Answer 1

A way of calculating economic activity as value of the total expenditure within an economy

Question 2

Gross Domestic Product

Answer 2

The value of goods and services produced in an economy in a given time period, usually a year

Question 3

Income

Answer 3

A flow of money received, earned or generated over time

Question 4

Income Methods

Answer 4

A way of calculating economic activity as the sum of the total income of the people within an economy

Question 5

Injections

Answer 5

Money that is added to the circular flow of income from someone other than firms or households

Question 6

Leakages/Withdrawls

Answer 6

Money that leaves the circular flow of income by going to someone other than firms or households

Question 7

Macroeconomics

Answer 7

The study of economics at an aggregated scale- either the national or international level

Question 8

Microeconomics

Answer 8

The study of economics at the scale of individuals, firms and markets

Question 9

Nominal

Answer 9

Measured using the current prices. Sometimes referred to as “money terms”

Question 10

Output Method

Answer 10

A way of calculating economic activity as value of the total output produced within an economy

Question 11

Real

Answer 11

Measured at constant prices in order to remove the impact on data collected over time

Question 12

Wealth

Answer 12

The value of a stock of assets at a given moment in time