Chapter 22: Economic growth Flashcards
Define long-run economic growth
The expansion of the productive capacity of the economy
Define short-run economic growth
An increase in actual GDP
Define nominal value
Value of an economic variable based on current prices, taking no account of changing prices through time
Define real value
Value of an economic variable, taking into account of changing prices through time
Define real GDP
GDP at constant prices, taking account of changing prices through time
Define nominal GDP
GDPO at current prices, taking no account of changing prices through time
Define gross national income
GDP plus net income from abroad
Define seasonal adjustment
A process by which seasonal fluctuations in a variable are smoothed to reveal the underlying trend
Define GDP per capita
The average level of GDP per head of population
Define productivity
Measure of the efficiency of a factor of production
Define labour productivity
Measure of output per worker, or output per hour worked
Define capital productivity
Measure of output per unit of capital
Define total factor productivity
The average productivity of all factors, measured as the total output divided by the total amount of inputs used
Define human capital
The stock of skills and expertise that contribute to a worker’s productivity which can be increased through education and training
Define economic cycle
A phenomenon whereby GDP fluctuates around its underlying trend, following a regular pattern
