1. Economic Growth

Question 1

GDP

Answer 1

Total value of goods and services produced in a country in 1 year

Question 2

Real GDP

Answer 2

Inflation has been taken into account

Question 3

Potential economic growth

Answer 3

Measure of increase in capacity in an economy- shown as a movement outwards of the PPF curve

Question 4

Increase in GDP means…

Answer 4

Means an increase in living standards

Question 5

GDP per capita

Answer 5

Total GDP divided by population- better indicator of incomes and living standards

Question 6

GDP increase –> increase in living standards depends on… (5)

Answer 6

• How much output is self consumed
• Reliability of data
• Relative exchange rates
• Type of spending by gov
• Size of the economy to start with

Question 7

PPPs

Answer 7

To compare GDP in different nations and take into account a basket of goods that could be bought in each country

Question 8

PPP exchange rate

Answer 8

Rate where the same basket of goods costs the same in each country

Question 9

GNI

Answer 9

Income received by a nation domestically and overseas

Question 10

National happiness

Answer 10

Measure of national wellbeing- alternative way for living standards