Keywords

Question 1

What is economic growth

Answer 1

An increase in availability of goods and services in an economy measured by gdp

Question 2

What is inflation

Answer 2

The increase general price level of goods and services

Question 3

What is the claimant count

Answer 3

The job seeker’s allowance (benefit) gov pays when unemployed

Question 4

Whats labour force survey

Answer 4

Survey for how many work

Question 5

What is coorporation tax

Answer 5

Taxes on company’s profits

Question 6

What is consumption

Answer 6

Total goods and services purchased by household in an economy at a given time period

Question 7

What is investment

Answer 7

Purchase of machinery/equipment using capitsl

Question 8

What is government spending

Answer 8

Total spending by public sector eg. Health etc

Question 9

What is Aggregate supply

Answer 9

Total amount of goods and services produced

Question 10

What is equilibrium

Answer 10

When AS= AD

Question 11

What is interest rates

Answer 11

Cost of borrowing and reward for saving

Question 12

What is exchange rate

Answer 12

Currency expressed in terms of another

Question 13

What is the wealth effect

Answer 13

When assets appreciate in value leading to consumers “feeling rich” so consume more

Question 14

What is negative wealth effect

Answer 14

When assets deppreciate in value so people feel poorer so consume less

Question 15

What is Disposable income

Answer 15

Income after tax

Question 16

What is wealth

Answer 16

Stock of assets

Question 17

What is savings

Answer 17

Disposable income that is not spent

Question 18

What is credit

Answer 18

Ability to obtain goods or services before payment, based on agreement to pay later

Question 19

What is gross investment

Answer 19

Investment made on capital goods

Question 20

What is net investment

Answer 20

Investment on capital goods , accounting for depreciation

Question 21

What is accelerator effect

Answer 21

Increase in economic growth leads to larger proportionate rise in investment

Question 22

What is subsidies

Answer 22

Government grant given to firms to encourage production

Question 23

What is unemployment trap

Answer 23

When people choose not to work due to welfare benefits

Question 24

What is investment-led

Answer 24

Economic growth caused by increase in investment(machinery)

Question 25

What is structural unemployment

Answer 25

Where workers are not working due to a lack of skills and qualifications

Question 26

What is positive output gap

Answer 26

When actual output is above full capacity output

Question 27

What is negative output gap

Answer 27

When actual output is less than full capacity output

Question 28

What is real income

Answer 28

How much income someone earns accounting for inflation

Question 29

What is competition policy

Answer 29

Policies to promote competition: such as lower prices which can encourage firms to invest in factors of production which can shift LRAS

Question 30

What is circular flow of income

Answer 30

Way of representing flows of money between two main groups in society - producers and consumers. Includes injection and withdrawals.

Question 31

What is injection in cicrular flow of income

Answer 31

Money(income) entering circular flow of income (households and firms)

Question 32

What are withdrawals in circular of income

Answer 32

Money leaving circular flow of income

Question 33

What is multiplier process

Answer 33

When an initial injection leads to a larger proportionate rise in economic growth

Question 34

Multiplier ratio

Answer 34

Ratio of the rise in national income to initial rise in AD

Question 35

Whats MPC

Answer 35

Proportion if extra income spent on consumption

Question 36

Whats MPS

Answer 36

Proportion of extra income that is saved.

Question 37

Whats MPM

Answer 37

Proportion of extra income thats spent in imports

Question 38

Whats MPT

Answer 38

Extra income spent on taxes

Question 39

What is nominal GDP

Answer 39

GDP without taking inflation into account

Question 40

What is Real GDP

Answer 40

GDP with inflation taken into account

Question 41

Whats GDP per capita

Answer 41

Measure of countrys output that accounts for its number of people

Question 42

Whats GNI

Answer 42

Gross national income = Gross domestic product + net income from abroad

Question 43

Whats Purchasing Power Parity

Answer 43

PPP= How much goods and servives would cost if countries used same currency.

Question 44

Whats Easterlin Paradox

Answer 44

The Easterlin Paradox is the observation that, despite increases in income, there may not be a corresponding increase in happiness or life satisfaction

Question 45

Whats real income

Answer 45

Income accounting for inflation

Question 46

What is deflation

Answer 46

Decrease in inflation

Question 47

Whats disinflation

Answer 47

Rise in inflation but at a slower rate

Question 48

Whats CPI

Answer 48

Gov creates basket of goods, works out an average price of each good and compares to a year ago to see inflation has occurred

Question 49

Whats RPI

Answer 49

CPI including housing costs

Question 50

Whats cost-push inflation

Answer 50

Inflation caused by a rise in cost of production

Question 51

Whats demand pull inflation

Answer 51

Inflation caused by a rise in AD

Question 52

Whats Fiscal drag effect

Answer 52

When worker’s real income is forced into higher tax brackets due to inflation

Question 53

Whats wage price spiral

Answer 53

A cycle of rising wages and prices