common macro aggregates

Question 1

what is national output

Answer 1

total of everything produced in a country in some period of time. it is a aggregate because its measured in different ways since we are adding different variables together. basically gdp

Question 2

how do we add different variables eg apples and oranges

Answer 2

look for what they have in common

Question 3

why is national output equal to national income

Answer 3

because what is produced is also sold and bought so its like a cycle

Question 4

what is potential output

Answer 4

its the maximum output if the country was fully efficient ( tech and everything)

Question 5

labor source

Answer 5

the amount of people that can work ( 15 and above)

Question 6

labor fource

Answer 6

the amount of people how can and want to work

Question 7

labor force participation rate

Answer 7

the ratio of people who can work that want to work labor force divided by working age population

Question 8

employment

Answer 8

the amount of people who do work

Question 9

unemployment

Answer 9

the amount of people who want to work but cant

Question 10

unemployment rate calculation

Answer 10

people working divided by the people not working times 100 ( both are eligible to work )

Question 11

frictional unemployment

Answer 11

lose / leave your job to find a new (better) one basically in-between jobs

Question 12

structural unemployment

Answer 12

lose your job because of new tech / innovations

Question 13

cyclical unemployment

Answer 13

lose job because of a recession

Question 14

natural rate unemployment

Answer 14

fluctuations in demand cause you to lose your job

Question 15

true unemployment

Answer 15

people that just gave up

Question 16

Productivity

Answer 16

measures output per unit of input, such as labor, capital

Question 17

cpi

Answer 17

consumer price index, measures a basket of goods bought by a typical consumer used to measure inflation

Question 18

how to calculate cpi

Answer 18

price of the given goods of that year divided by the base year

Question 19

what is interest rate

Answer 19

price we pay for borrowing to have stuff now

Question 20

real vs nominal interest rate

Answer 20

real interest is adjusted for inflation nominal isn’t

Question 21

fisher equation

Answer 21

nominal interest = real interest + inflation rate

Question 22

What is the exchange rate

Answer 22

its the value of one countries currency vs another

Question 23

How do the exchange rate fluctuations influence international trade patterns

Answer 23

the lower the value of the currency the lower the value of imports are and the higher the value of exports are so they are inversely related just think logically if cad goes down us milk isnt as worth it for cad but if cad price goes down then its worth for us ppl to come n buy

Question 24

output gap

Answer 24

actual gdp vs potential or real gnp and real gdp

Question 25

national product

Answer 25

gnp for short is the estimated total value of all goods and services by the people of the country and not other countries

Question 26

gdp

Answer 26

its the market value of all goods produced in a countries border

Question 27

gdp vs gnp

Answer 27

gdp measures the goods and services in the border of the country but those goods can be made by international businesses and it will still count gnp is the value of the goods a services produced by a countries citizens in the country and abroad in different countries