Ch 12&13 Flashcards
An income level below which income is insufficient to support
poverty threshold
The percentage of people who live in households that have an income below the poverty line
poverty rate
The annual income earned by individuals and firms
Gross National Product
Ability to purchase goods and services
purchasing power
A steady long-term increase in Real GDP
Economic Expansion/Growth
The total amount of goods and services at all possible costs
Aggregate Supply
The decline in real GDP combined with the rise of prices
stagflation
Prolonged economic contraction
recession
Process of increasing the amount of capital per work
Capital Deepening
Total value of all goods and services
GDP
The percentage rate of change of price level over time
Inflation rate
when you are working a job that you are overqualified for
underemployed
When there is a general rise in prices
inflation
This is a number of goods in an economy that will be purchased
aggregate demand
The index that is used to measure inflation
Consumer Price Index
types of unemployment
Seasonal
Frictional
Structural
Cyclical
The highest point for GDP
peak
One thing that can affect the business cycle of an economy
External Shocks
Realistic Unemployment rate for a good economy
5%
One of the root causes of poverty
Race
One of the causes of inflation
Too much money
The best way to measure GDP
Real GDP per capita
Unemployment that happens when the economy goes up and down
Cyclical Unemployment
Which type of GDP is measured in the current prices
Nominal
When the economy hits its lowest points
Trough
Unemployment when industries slow or shut down during seasons
Seasonal
Another cause for poverty
Women
Capital deepening leads to what
Standard of Living
When the economy is shrinking in the business cycle
Contraction
