Chapter 18, Economic factors, GPD and the business cycle

Question 1

Macroeconomics

Answer 1

the study and analysis of the behaviour of the economy

Question 2

The economy

Answer 2

the collective behaviour of a behaviour of a number of different groups such as businesses and people as employees and consumers and the government

Question 3

Economic activity

Answer 3

the level of output un all sectors of the economy - primary, secondary, tertiary

Question 4

Gross domestic product

Answer 4

GPD, the total value of all the economy’s output

Question 5

Circular flow of income

Answer 5

the flow of income from the business to households as payment for work, and from households to businesses as payment for products

Question 6

Imports

Answer 6

purchase of goods from abroad

Question 7

Leakages

Answer 7

Income that ‘leak away’ from the economy and so does not get passed back to UK firms from households; this comprises taxes savings and imports

Question 8

Injections

Answer 8

income coming into the UK that does not come from the UK households, investment, government spending and exports

Question 9

Exports

Answer 9

the sale of goods to other countries by the Uk

Question 10

Business cycle

Answer 10

rises and falls in economic activity; these follow a pattern that can be identified as boo, recession, slump and recovery