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ECON > Econ Test 2 Vocab > Flashcards

Econ Test 2 Vocab Flashcards

1
Q

Gross Domestic Product

A

value of all final goods and services produced within a country in a given time period

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2
Q

final goods

A

bought by final user does not move on

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3
Q

intermediate goods

A

processed or transformed into another product that is sold, moves on

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4
Q

value

A

what it’s worth (price x quantity)

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5
Q

nominal GDP

A

output valued at current prices

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6
Q

real GDP

A

output valued at constant base year prices

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7
Q

price index

A

measure of all levels of prices

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8
Q

inflation

A

percent change in price index or widespread increase in level of prices

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9
Q

economic growth

A

increase in real GPD per capita

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10
Q

rule of 72/70

A

if something grows at an annual rate of g% then that thing will double in size in about 72/g years

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11
Q

human capital

A

additional productive ability acquired through training or education or experience.

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12
Q

physical capital

A

produced means of production

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13
Q

economic development

A

economic growth in a country with low GDP per Capita

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14
Q

rule of law

A

laws applied “reasonably” fairly to all

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15
Q

liquidity

A

easily converted to cash

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16
Q

unemployment rate

A

percent of labor force that has no job

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17
Q

labor force

A

body of potential workers

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18
Q

consumption

A

spending by households on goods and services, with the exception of purchases of new housing.

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18
Q

Investment

A

Spending on capital equipment inventories and structures including household purchases of new housing

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19
Q

Government purchases

A

Spending on goods and services by local state and federal government’s

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20
Q

Net exports

A

Spending on domestically produced goods by foreigners (exports) minus spending on foreign goods by domestic residents (imports)

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21
Q

GDP deflator

A

A measure of the price level calculated as the ratio of nominal GDP to real GDP times 100

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22
Q

Consumer price index (CPI)

A

A measure of the overall cost of goods and services bought by a typical consumer

23
Q

Inflation rate

A

The percent change in the price index from the proceeding period

24
Q

Producer price index

A

A measure of the cost of a basket of goods and services bought by firms

25
Q

Indexation

A

The automatic correction by law or contract of a dollar amount for the effects of inflation

26
Q

Nominal interest rate

A

The interest rate as usual he reported without a correction for the effects of inflation

27
Q

Real interest rate

A

The interest-rate corrected for the effects of inflation

28
Q

Productivity

A

The quantity of goods and services produced from each unit of labor input

29
Q

Natural resources

A

The inputs into the production of goods and services that are provided by nature such as land rivers and mineral deposit

30
Q

Technological knowledge

A

Societies understanding of the best ways to produce goods and services

31
Q

Diminishing returns

A

The property whereby the benefit from an extra unit of an input declines of the quantity of the input increases

32
Q

Catch up effect

A

The property where by countries that start off poor tend to grow more rapidly than countries that start off Rich

33
Q

Financial system

A

The group of institutions in the economy that help to match one person saving with another person’s investment

34
Q

Financial markets

A

Financial institution through which savers can directly provide funds to borrowers

35
Q

Bond

A

A certificate of indebtedness

36
Q

Stock

A

A claim to partial ownership in a firm

37
Q

Financial intermediaries

A

Financial institutions through which Savers can indirectly provide funds to borrowers

38
Q

Mutual fund

A

An institution that sell shares to the public and uses the proceeds to buy a portfolio of stocks and bonds

39
Q

National saving

A

The total income in the economy that remains after paying for consumption and government purchases

40
Q

Private saving

A

The income that households have left after paying for taxes and consumption

41
Q

Public saving

A

The tax revenue that the government has left after paying for it spending

42
Q

Budget surplus

A

In excess of tax revenue over government spending

43
Q

Budget deficits

A

A shortfall of tax revenue from government spending

44
Q

Market for loanable funds

A

The market in which those who want to save supply funds and those who want to borrow to invest demand funds

45
Q

Labor force participation rate

A

The percentage of the adult population that is in the labor force

46
Q

Natural rate of unemployment

A

The normal rate of unemployment around what’s the unemployment rate fluctuated

47
Q

Cyclical unemployment

A

The deviation of unemployment from its natural rate

48
Q

Discouraged workers

A

Individuals who would like to work but have given up looking for a job

49
Q

Frictional unemployment

A

Unemployment that results because it takes time for workers to search for the jobs that best suit their tastes and skills

50
Q

Structural unemployment

A

.

51
Q

Unemployment insurance

A

A government program that partially protects workers incomes when they become unemployed

52
Q

Union

A

A worker association that bargains with employers over wages benefits and working conditions

53
Q

Collective-bargaining

A

The process by which unions and firms agree on the terms of employment

54
Q

Strike

A

The organized with drawl of labor from a firm by a union

55
Q

Efficiency wages

A

Above equilibrium wages paid by firms to increase worker productivity

ECON (5 decks)

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