18- economic factors: GDP and The business cycle Flashcards
1
Q
What is economic decline?
A
Fall in rate of economic activity in the economy
GDP decreases
2
Q
What is GDP?
A
total output of all goods and services produced
3
Q
What is economic growth?
A
A rise in economic activity within the economy
GDP increases
4
Q
Draw the business cycle
A
hint: BOOM!
5
Q
What is meant if leakages are more than injections?
A
GDP falls
demand may fall
business will invest less and make redundancies
6
Q
Draw the flow of income?
A
hint: households
7
Q
What is meant by a boom, recession, and a slump?
A
B- high employment and consumption
R- falls in GDP
S- high level of unemployment and low profit
8
Q
What is economic activity?
A
The production of goods and services
Level of economic activity refers to output in the P, S, and T sector
