Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

Economics > Unit 4(4.6-4.8) > Flashcards

Unit 4(4.6-4.8) Flashcards

(57 cards)

Start Studying
1
Q

what is employment

A

the number of people in work

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

what is pattern of employment

A

the type of jobs that people do

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

what are some changes in employment patterns

A

changes in the number of women
changes to the age at which people retire
shifts between private and public sector

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

what is labour force

A

the population that can work(all people of working age)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

what is the dependent population

A

people who are not in the labour force and depend on the labour force to supply them with goods

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

what is full employment

A

situation where entire labour force is employed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

what is level of unemployment

A

measures the number of people who are willing and able to work but are not employed at the time

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

what is unemployment rate and formula

A

the number of people employed as a total number of the workforce
number of people unemployed/number of people in the workforce X 100

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

what can unemployment be measured by

A

the claimant count(number of people entitled to unemployment benefits)
labour force survey

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

what is seasonal unemployment

A

people that are unemployed at certain times of the year(farming)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

what is frictional unemployment

A

when people are between jobs
doesnt necessarily have to be a concern

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

what is structural unemployment

A

due to long term change in the structure of the economy, people are unable to find a new job due to geographical or occupational mobility

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

what is cyclical unemployment

A

there is a lack of aggregate demand in the economy
with less demand for products, firms cut their production and labour

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

why is it bad for people to be unemployed

A

they lose their working skill and can cause the standard of living to fall
they can be demotivated
can lead to poverty and rise in crime rates
purchasing power will fall

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

why is unemployment bad for firms

A

they will have to retrain workers
pay redundancy payments
they are left with spare machinery leading to higher average costs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

why is unemployment bad for the country

A

people will rely on unemployment benefits and the burden on taxpayers will rise
public expenditure will have to be cut down meaning public goods cannot be provided
the economy will be inefficient on the PPC

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

how will demand side policies reduce unemployment

A

reduce cyclical unemployment by increasing aggregate demand

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

how will supply side policies reduce unemployment

A

they will reduce structural and frictional unemployment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

what are expansionary policies to increase demand

A

cutting taxes and increasing government spending to boost demand and keep employment high
however there is a time lag and they may not work

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

how does depreciating exchange rate reduce unemployment

A

causes exports to be cheaper which increases demand and increases production and employment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

how does controlling inflation reduce unemployment

A

if the government controls incflation it will reduce firm costs and increase employment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

how does cutting unemployment benefits reduce unemployment

A

gives an incentive for people to find work
however goes against welfare principle of the government

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

how does removing labour market regulations

Study These Flashcards
A

makes it easier to hire and fire workers which improves labour market flexibility
but this can cause temporary unemployment and greater job insecurity

24
Q

how does training workers reduce unemployment

Study These Flashcards
A

eliminates structural unemployment and improves occupational mobility
requires large amounts of money and is only seen long term

25
how does promoting industry in unemployed areas reduce unemployment
governments provide subsidies when factories are set up in certain areas
26
what is economic growth
the increase in the amount of good and services produced over a period of time
27
what is gross domestic product(GDP)
the total market value of all final goods and services provided by the factors of production in a period of time
28
what is nominal GDP
the value of output produced in an economy without any adjustments for inflation
29
what is Real GDP
the value of output produced in an economy that is adjusted for inflation
30
what is GDP per head/capita
measures the average output or income of each person in an economy provides a measure of the living standards in a country
31
what does an increase in real GDP indicate
it indicates economic growth since goods have increased and economies are utilizing their resources properly
32
causes of economic growth
discovery of more natural resources investment in new capital and infrastructure technical progress reallocation of existing resources
33
benefit of economic growth
greater availability of goods and services to satisfy consumer wants and needs increased employment living standards may improve increased sale, profit investment in capital goods will increase(Beneficial for long term) low and stable inflation if growth in supply meets demand increased tax revenue to be used for public goods and services
34
drawbacks of economic growth
increase in capital may replace labour causing an increase in unemployment resources may get depleted over time negative externalities(pollution,global warming) are increased if demand is more than output, inflation may be caused widening income inequalities because may not be evenly distributed
35
what do governments aim for in economic growth
sustainable economic growth which can be maintained without creating significant problems
36
what is recession
when there is no economic growth and read GDP is falling happens when there is rapid economic growth that causes high inflation
37
what are the causes of recession
banks reduce lending rise in interest rates(reduces demand) fall in real wages(income doesnt increase at same rate as inflation) fall in consumer/business confidence cut in government spending trade wars supply side shocks
38
consequences of recession
firms go out of business unemployment(cuts in production) fall in income(cuts in production) rise in poverty and inequality fall in asset prices(stock market crashes and shares lose value) higher budget deficit(fall in tax revenue) economy moves inwards on PPC
39
what policies are used to promote demand for economic growth
expansionary fiscal and monetary policies
40
what do supply side polices do to promote economic growth
implemented if factors of production are affecting the economy
41
why are demand side polices dangerous in promoting economic growth
policies that increase the rate of demand can lead to a recession if not controlled properly
42
why are supply side policies less effective in promoting economic growth
take time to have an effect wont solve the fundamental problem of deficiency of aggregate demand
43
what is inflation
the general and sustained increase in the level of prices of goods and services over a period of time measured with the Consumer Price Index
44
how is the CPI calculated
take weight of goods and multiply with base year price take weight and multiply with next year new year - base year = inflation
45
what is the CPI
the selection of goods and services normally purchased by a household the prices are then monitored
46
what is demand pull inflation
inflation caused by an increase in aggregate demand price rises since aggregate demand is larger than aggregate supply
47
what is cost push inflation
caused by an average increase in cost of production causing prices of goods to increase supply curve will shift left
48
consequences of inflation
lower purchasing power exports are less internationally competitive inflation will cause more inflation(cost of living goes up causing workers to demand higher wages causing cost push inflation) fixed income groups, lenders and savers will lose(lenders who recieve the money after inflation has lost value on their money)
49
how does contractionary monetary policy control inflation
interest rates are raised to reduce spending and investing to reduce demand has a time lag
50
how does contractionary fiscal policy control inflation
raising taxes to reduce income and demand cutting down of government spending unpopular policy and only used in severe situations
51
how do supply side policies control demand
allows supply to catch up to demand done through deregulation and incentives to reduce average costs of production
52
how does exchange rate policy control inflation
appreciating domestic currency can lower import prices which reduces cost push inflation export also becomes expensive whcih lowers export demand
53
what is deflation
a general fall in the price level
54
causes of deflation
aggregate supply exceeding aggregate demand(excess output causing prices to fall) demand falls labour productivity rises(higher output leads to lower average costs) technological advance(reduced cost of production)
55
consequences of deflation
lower prices can discourage production and cause unemployment investors are discourages to invest can cause recessions tax revenue of government will fall borrowers will lose money since debt becomes higher increase real debt burden of the government
56
how does expansionary monetary policy control deflation
cutting interest rates to encourage more spending and investing
57
how does expansionary fiscal policy control deflation
increase government spending to increase demand cutting taxes

Economics (9 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions