The measurement of Macroeconomics performance

Question 1

Availability of credit

Answer 1

Funds available for firms and households to borrow

Question 2

Base year

Answer 2

the first year in an economic or financial index

Question 3

Black (informal, shadow market)

Answer 3

Economic activities that occurs beneath the governments radar

Question 4

Consumer prices index (CPI)

Answer 4

An official measure used to calculate the rate of consumer price inflation, using a basket of common goods

Question 5

Claimant count

Answer 5

A method of measuring unemployment by
counting all of those who claim
the Jobseekers Allowance and other
unemployment related benefits

Question 6

Economic shock

Answer 6

Unexpected events and their effects on
economies; may be demand side or supply
side

Question 6

Credit crunch

Answer 6

Occurs when there is low availability
of credit in the economy

Question 7

Exchange rate

Answer 7

Market value of all products produced
per annum by the labour and property
supplied by the citizens of one country

Question 8

Full employment

Answer 8

All those willing and able to work are
able to find jobs.

Question 8

Exports

Answer 8

Domestically produced goods and
services sold to residents of other
countries

Question 9

Gross National Income (GNI)

Answer 9

The sum of value added by all producers who reside in a nation, plus product taxes not included in the value of output, plus receipts of primary income from abroad

Question 10

Gross National Product (GNP)

Answer 10

Market value of all products produced
per annum by the labour and property
supplied by the citizens of one country

Question 11

Imports

Answer 11

Non-domestically produced goods and
services sold to residents of this country

Question 11

Index numbers

Answer 11

Numbers allowing accurate comparisons
over time to be made. The base year
value is typically 100

Question 12

Inflation rate target

Answer 12

The CPI inflation rate target set by the
government, which the Bank of England
attempts to achieve; currently 2%.

Question 13

Job Seeker’s Allowance (JSA)

Answer 13

Unemployment-related benefit

Question 14

Labour Force Survey

Answer 14

A quarterly survey of UK households,
recording information on the personal
employment circumstances of the
respondents

Question 15

Liquidity

Answer 15

The ease with which an asset can be
turned into cash without loss or delay

Question 16

Macroeconomics

Answer 16

Involves the study of the whole economy
at the aggregate level.

Question 17

Macroeconomic stability

Answer 17

Occurs when there is low volatility of key
macroeconomic indicators

Question 18

Marginal propensity to consume (MPC)

Answer 18

The proportion of an increase in
disposable income that is spent on
consumer goods.

Question 19

National wealth

Answer 19

The stock of all goods with value in an
economy

Question 20

Per capita

Answer 20

Per person/ per head

Question 21

Performance indicator

Answer 21

Provides information used to judge
success or failure of a government
policy.

Question 22

Policy instrument

Answer 22

Tool or set of tools used to try and meet a policy objective

Question 22

Policy objective

Answer 22

Target or goal policy-makers aim to hit

Question 23

Price index

Answer 23

An index number showing the extent to
which a set of prices has changed in
comparison to the prices in the base
year

Question 24

Purchasing Power Parity (PPP)

Answer 24

Adjustments of exchange rates to reflect
the actual purchasing power of a
currency.

Question 25

Wealth

Answer 25

Stock of assets

Question 25

Retail prices index (RPI)

Answer 25

An older measure used to calculate the
rate of consumer price inflation

Question 26

Weighting

Answer 26

When certain data items in a set are
assigned a higher or lower importance
than other data items in the set