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Economics - Macro > Topic 1 - The Measurement Of Macroeconomic Performance > Flashcards

Topic 1 - The Measurement Of Macroeconomic Performance Flashcards

1
Q

Availability Of Credit

A

Funds available for firms and households to borrow

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2
Q

Base Year

A

The first year in an economic or financial index

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3
Q

Black (informal, shadow) Market

A

Economic activities that occur below the governments radar

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4
Q

Claimant Count

A

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

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5
Q

Consumer Prices Index (CPI)

A

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

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6
Q

Credit Crunch

A

Occurs when there is low availability of credit in the economy

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7
Q

Economic Shock

A

Unexpected events and their effects on economies: can be demand side or supply side

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8
Q

Exchange Rate

A

The price of currency measured in the terms of another currency

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9
Q

Exports

A

Domestically produced goods and services sold to residents of other countries

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10
Q

Full Employment

A

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

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11
Q

Gross National Income (GNI)

A

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

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12
Q

Gross National Product (GNP)

A

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

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13
Q

Imports

A

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

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14
Q

Index Numbers

A

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

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15
Q

Inflation Rate Target

A

The CPI inflation rate target set by the government, which Bank Of England aims to achieve, currently 2%

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16
Q

Job-Seekers Allowance (JSA)

A

Unemployment related benefit

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17
Q

Labour force survey

A

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

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18
Q

Liquidity

A

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

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19
Q

Macroeconomics

A

Involves studying the whole economy at an aggregate level

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20
Q

Macroeconomic Stability

A

Occurs when there is a low volatility of key macroeconomic indicators

21
Q

Marginal Propensity To Consume (MPC)

A

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

22
Q

National Wealth

A

The stock of all goods with value in an economy

23
Q

Per Capita

A

Per Person/ Per Head

24
Q

Performance Indicator

A

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

25
Q

Policy Instrument

A

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

26
Q

Policy Objective

A

Target or goal policy-makers aim to hit

27
Q

Price Index

A

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

28
Q

Purchasing Power Parity (PPP)

A

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

29
Q

Retail Prices Index (RPI)

A

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

30
Q

Wealth

A

Stock of assets

31
Q

Weighting

A

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

32
Q

Short Term Economic Growth

A

Growth of real output resulting from using idle resources, including labour. thereby taking up the slack in the economy

33
Q

Long Term Economic Growth

A

An increase in the economy’s potential level of real output and an outward shift of the economy’s PPF

34
Q

Gross Domestic Product (GDP)

A

the sum of all goods and services, or level of output, produced in the economy over a period of time e.g 1 year

35
Q

Real GDP

A

A measure of all goods and services produced in an economy, adjusted for price changes or inflation. The adjustment transforms changes in nominal GDP

36
Q

Nominal GDP

A

GDP measured at the current rate market prices, without removing the effects of inflation

37
Q

Economic Growth

A

The increase in potential level of real output the economy can produce over a period

38
Q

Full Employment

A

When all who are willing and able to work are employed

39
Q

Unemployment

A

When not all those who are willing and able to work are employed

40
Q

Objectives Of Economic Policy (1)

A

L - Low inflation
U - Low unemployment
S - Sustainable growth
T - Trade Balance

41
Q

Objectives Of Economic Policy (2)

A

T - Trade balance
I - Low inflation
G - Sustainable Growth
E- High employment
R - Redistribution of wealth / levelling up

42
Q

National Income

A

Measures the monetary value of the flow of output of goods and services. Produced in an economy over a period of time (usually one year)

43
Q

Uses Of National Income Data

A

Keep track off:
Rate of economic growth
Changes to living standards
Changes to the distribution of income

44
Q

Nominal

A

Monetary values for data
Not inflation adjusted
Data expressed at current prices

45
Q

Real

A

Adjusted for inflation
Prices held at level of chosen base year
Data expressed at constant prices

46
Q

How to calculate value added

A

Value added = value of production - value of intermediate inputs

47
Q

What does SPICED stand for?

A

Strong
Pound
Imports
Cheaper
Exports
Dearer

48
Q

What does WPIDEC stand for?

A

Weaker
Pound
Imports
Dearer
Exports
Cheaper

Economics - Macro (4 decks)

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