Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

ECON112 STUDY > ECON112 FLASHCARDS > Flashcards

ECON112 FLASHCARDS

1
Q

Gross National Income (GNI)

A

the total income earned by a nations residents.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Gross National Product (GDP)

A

the final value of all goods and services produced within an economy over a given period

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Net Transfers

A

the total sum of payments that are not in exchange for any currently produced goods or services (e.g. benefits payments)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Consumption (C)

A

spending by households on goods and services

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Investment (I)

A

the purchase of goods that will be used in the future to produce other goods and services (e.g. machinery, infrastructure, capital goods)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Government Purchases/Spending (G)

A

spending on goods and services by local and central governments (not including transfer payments (welfare) as these payments do not reflect an economies production).

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Net Exports (NX)

A

= Exports (X) - Imports (M); the purchase of domestically produced goods by foreigners (exports) minus the domestic purchases of foreign goods (imports)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Nominal GDP

A

uses current prices to value the economy’s production of goods and services in that year. changes in nominal GDP reflect both changes in the quantities of goods and services and their prices.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Real GDP

A

uses constant (base-year) prices to place a value production of goods and services. Changes in real GDP reflect only changes in the quantity of goods and services.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Economic Wellbeing

A

having present and future financial security.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Inflation

A

the change in value of money over time.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Consumer Price Index (CPI)

A

measures the changing price of the goods and services New Zealand households buy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

GDP Deflator

A

a measure of the price level as the ratio of nominal GDP to real GDP x 100 (looks at inflation, opposed to CPI real output)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

4 Factor Model

A

shows how an economy’s total income equals its total expenditure

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Capital Deepening

A

the capital per worker is increasing in the economy. This is also referred to as increase in the capital intensity.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

The Fisher Effect

A

describes the relationship between the nominal interest rate and the real interest rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Compound Interest

A

increasing value of interest rates on investments over yearly periods.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Taylor Rule

A

the central bank will increase interest rates whenever expected inflation is higher than the target rate, vice versa

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Market For Loanable Funds

A

The interaction between the supply of savings and the demand for loans determines the real interest rate and how much is loaned out.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Yield Curve

A

shows several yields or interest rates across different contract lengths

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Expected Inflation

A

the rate of inflation that people expect

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Money Supply

A

the total value of money available in an economy at a point of time

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Money Demand

A

the demand for money, affected by banks interest rates, income and inflation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

The Reserve Bank of New Zealand

A

NZ’s central bank that sets the OCR

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

Monetary Policy

A

the regulation of the supply and demand of money so that currencies remain stable.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

Expansionary Monetary Policy

A

involves the RBA decreasing the OCR to meet target inflation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

Contractionary Monetary Policy

A

involves the RBA increasing the OCR to meet target inflation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

Official Cash Rate (OCR)

A

the interest rate set by the RBA in order to keep target inflation within 1-3%

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

Growth

A

an increase in the amount of goods and services produced per head of the population over a period of time.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

Target Interest Rate

A

key interest rate that a central bank uses to guide monetary policy toward the desired economic outcomes.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

Dovish Policy

A

favor loose monetary policy (Lower interest rates at every level of inflation)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

Hawkish Policy

A

Favor tight monetary policy (higher IR at every level of inflation)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

Full Employment

A

a situation in which there is no cyclical or deficient-demand unemployment.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

MPK

A

marginal product of capital, the additional production that a firm experiences when is added an extra unit of capital.

35
Q

Balance of Payments

A

the difference between all money coming into, and out of a country within a certain period

36
Q

Current Account Balance (CAB)

A

the sum of net exports (NX) and net foreign income (NFI)

37
Q

Net Capital Outflow (NCO)

A

the purchase of foreign assets by domestic residents minus the purchase of domestic assets by foreigners.

38
Q

Capital Account (KAB)

A

difference between total receipts from the sale of domestic assets to foreigners and total payments abroad for purchasing foreign assets

39
Q

Nominal Exchange Rate

A

the rate at which a person can trade the currency of one country for the currency of another

40
Q

Appreciation

A

an increase in the value of an asset, over time.

41
Q

Depreciation

A

a decrease in the value of an asset, over time.

42
Q

Induced Consumption

A

the portion of consumption that varies with disposable income.

43
Q

Real Exchange-Rate (RER)

A

the rate at which a person can trade the goods and services of one country for the goods and services of another country

44
Q

Purchasing-Power Parity

A

a unit of any given currency should be able to buy the same quantity of goods and services in all countries.

45
Q

Twin Deficit Theory

A

when a nation has both a current account deficit and a budget deficit. This means the country’s economy is importing more than it is exporting, and the country’s government is spending more money than it is generating.

46
Q

The Rule of 70

A

a variable grows at ‘x’ percent per year, then that variable will double approximately (70 / x) years

47
Q

The Production Function

A

figures out how much output is created from a given mix of inputs

48
Q

Economic Output

A

the quantity of goods or services produced in a given time period, by a firm, industry, or country

49
Q

Technology

A

anything that helps us produce things faster, better or cheaper

50
Q

Physical Capital

A

are tangible, man-made objects that a company buys or invests in and uses to produce goods.

51
Q

Human Capital

A

an intangible asset or quality not listed on a company’s balance sheet that is used to help produce goods.

52
Q

Natural Resources Diminishing

A

the idea of limited natural resources, to unlimited human wants… how to operate an economy within the ecological constraints of earth’s natural resources.

53
Q

Marginal Returns

A

the rate of return for a marginal increase in investment; roughly, this is the additional output resulting from a one-unit increase in the use of a variable input, while other inputs are constant.

54
Q

Catch-Up Theory

A

poorer economies tend to grow more rapidly than wealthier economies, and so all economies will eventually converge in terms of per capita income.

55
Q

Keynesian Cross Diagram

A

determines the equilibrium level of real GDP by the point where the total or aggregate expenditures in the economy are equal to the amount of output produced.

56
Q

Short-Run

A

a period of time in which at least one input is fixed while others are variable.

57
Q

Long-Run

A

a period of time in which all factors of production and costs are variable.

58
Q

Planned Investment

A

the sum of everything a firm intends to invest, including the additions it plans to add to its cache of capital goods and its stock

59
Q

Sacrifice Ratio

A

reflects the relationship between inflation and output

60
Q

Peak

A

the highest point between the end of an economic expansion and the start of a contraction in a business cycle.

61
Q

Trough

A

the lowest point between the end of an economic expansion and the start of a contraction in a business cycle.

62
Q

Recession

A

a period within the business cycle where there is a significant decline in economic activity spread across the economy that can last from a few months to more than a year.

63
Q

Expansion

A

an increase in the level of economic activity, and of the goods and services available. It is a period of economic growth as measured by a rise in real GDP.

64
Q

Fiscal Policy

A

refers to the governments ability to tax and spend within the economy.

65
Q

The Asian Miracle

A

unprecedented levels of growth in Asian countries (China, Japan) since the mid-19th century.

66
Q

Potential Output

A

refers to the highest level of real gross domestic product that can be sustained over the long term.

67
Q

The Natural Rate of Unemployment

A

represents the lowest unemployment rate whereby inflation is stable or the unemployment rate that exists with non-accelerating inflation.

68
Q

Output Gap

A

indicates the difference between the actual output of an economy and the maximum potential output of an economy expressed as a percentage of gross domestic product (GDP).

69
Q

Cyclical Unemployment

A

the result of businesses not having enough demand for labor to employ all those who are looking for work at that point within the business cycle.

70
Q

Okun’s Law

A

each extra percentage point of cyclical unemployment is associated with about a 2-percentage point increase in the output gap, measured in relation to potential output.

71
Q

The Keynesian Model

A

the relationship between consumption, planned aggregate expenditure, and output/income

72
Q

Marginal Propensity to Consume (MPC)

A

the proportion of an aggregate raise in pay that a consumer spends on the consumption of goods and services, as opposed to saving it.

73
Q

Autonomous Consumption

A

the expenditures that consumers must make even when they have no disposable income.

74
Q

Planned Aggregate Expenditure (PAE)

A

the total amount of spending that is expected to occur in the economy

75
Q

Natural Rate of Output

A

occurs when all available resources are used efficiently within the PPF curve

76
Q

Time Lag

A

the delay between an economic action and it’s consequence

77
Q

The Multiplier Effect

A

the proportional amount of increase, or decrease, in final income that results from an injection, or withdrawal, of spending.

78
Q

The Crowding Out Effect

A

increased interest rates lead to a reduction in private investment spending such that it dampens the initial increase of total investment spending

79
Q

Aggregate Demand

A

the total amount of demand for all finished goods and services produced in an economy.

80
Q

Aggregate Supply

A

the total supply of goods and services produced within an economy at a given overall price in a given period

81
Q

Demand Shock

A

a sudden and surprise event that dramatically increases or decreases demand for particular goods or services, usually on a temporary basis.

82
Q

Supply Shock

A

an unexpected event that suddenly changes the supply of a product or commodity, resulting in an unforeseen change in price.

83
Q

Stagflation

A

characterized by slow economic growth and relatively high unemployment

84
Q

The Phillips Curve

A

illustrates that inflation and unemployment have a stable and inverse relationship.

ECON112 STUDY (1 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions