BA101 Flashcards
Recession
Two consecutive quarters of negative economic growth
Economic Growth
The change in the general level of economic activity
Aggregate Expenditures
The Total amount of expenditures in the economy
Gross Domestic Product (GDP)
The total market value of all final products and services produced in the US
Frictional Unemployment
People who are between jobs
Seasonal Unemployment
People whose services are not needed during some seasons
Cyclical Unemployment
People who are unemployed because of poor economic conditions
Structural unemployment
People who are unemployed because they do not have adequate skills
Inflation
The increase in the general level of prices of products and services over a specified period of time
Cost-push inflation
The situation when higher prices charged by firms are caused by higher costs
Demand-pull inflations
The situation when prices of products and services are pulled up because of strong consumer demand
Demand schedule
A schedule that indicates the quantity of a product that would be demanded at each possible price
Supply schedule
A schedule that indicates the quantity of a product that would be supplied (produced) by firms at each possible price
Surplus
The situation when the quantity supplied by firms exceeds the quantity demanded by customers
Shortage
The situation when the quantity supplied by firms is less that the quantity demanded by customers
Equilibrium price
The price at which the quantity of a product supplied by firms equals the quantity of the product demanded by customers
Money supply
Demand deposits (checking accounts), currency held by the public, and traveler’s checks
Federal Reserve System
The central bank of the US
Monetary policy
Decisions on the money supply level in the US
Fiscal policy
Decisions on how the federal government should set tax rates and spend money
Excise taxes
Taxes imposed by the federal government on particular products
Federal budget deficit
The situation when the amount of federal government spending exceeds the amount of federal taxes and other revenue received by the federal government
