Brainscape's Knowledge GenomeTM

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


See full index

Year 1 Micro > Macro 1 > Flashcards

Macro 1 Flashcards

1
Q

Accelerator effect

A

The relationship between the change in new investment and the rate of change of national income

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

AD

A

Total planned expenditure in the economy C I G X-m

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

AS

A

The total value / amount of g and s supplied in an economy

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

Balance of payments

A

A record of a country’s international transactions over a year

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

Balance of trade

A

Visible exports minus visible imports

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

Balanced budget

A

Where government receipts equal government spending in a fiscal year

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

Bank rate

A

The IR set by the BoE

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

Bond

A

A method used by the government to finance. Budget deficit, issued in return for money and interest

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

Boom

A

Period of above average short run economic growth

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

Broad money

A

Money held on banks and building societies that is not immediately accessible

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

Budget deficit

A

Where gov spending exceeds gov receipts in a fiscal year

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

Budget surplus

A

Where gov receipts exceed gov spending a fiscal year

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

Central bank

A

The financial institution typically responsible for setting short term interest rates and issuing notes and coins

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

Circular flow of income

A

Model explaining the equilibrium level of national income

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

Claimant count

A

A measure of unemployment- the number claiming unemployment benefits

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

Consumption

A

Spending by domestic households on g and s

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

Cost push inflation

A

Where increases cost of production result in firms increasing there prices , leading to an increase in the general price level

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

CPI

A

Consumer price index - target measure for inflation by the MPC of the BoE

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

Credit crunch

A

When borrowing becomes more expensive or unavailable

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

Current account

A

Part of the BoP which looks at the net income flows earned through either trade in G and S or the reward from investments located overseas

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

Current account deficit

A

Where the flows of money from trade and other incomes out of the country are greater than the equivalent flows into the country

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

Cyclical unemployment

A

Demand deficient unemployment that results from a downturn in the economic cycle

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

Deflation

A

A situation where the general price level falls

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

Deindustrialision

A

A fall in the proportion of national output acccountdd for by the manufacturing sector of the economy

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

Demand management

A

Using monetary and fiscal policy to control AD to minimise fluctuations in the economic cycle

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

Demand pull inflation

A

Where AD exceeds AS leading to an invrease in the price level

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

Demand side shock

A

Unexpected and significant changes in the level of AD

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

Deregulation

A

The process of removing gov controls from markets

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

Direct tax

A

One that cannot be passed on to another person and is usually levied on incomes

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

Disinflation

A

Where the rate of inflation is falling but still positive

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

Discretionary fiscal policy

A

The deliberate manipulation of gov spending and taxation to influence the economy

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

Disposable income

A

Income available to households after the payment of income tax and national insurance contributions

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

Downtown

A

Period of the economic cycle where short run economic growth falls from above average to below average

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

Economic cycle

A

The tendency for economic growth to fluctuate over time

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

Economic shock

A

Sudden, unexpected events that will affect the macroeconomy in a significant way

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
36
Q

Exchange rate

A

The price of one currency expressed in terms of another

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
37
Q

Exports

A

G or s sold abroad

38
Q

Fiscal policy

A

Control of the economy via the use of taxation and gov spending

39
Q

Frictional unemployment

A

People between jobs

40
Q

Full employment

A

The level of employment where all those economically active are able to find work at the going wage rate

41
Q

GDP

A

Gross domestic product- the total value of g and s produced in the economy

42
Q

Globalisation

A

The ability to produce goods anywhere in the world and sell them in any country

43
Q

Gov expenditure

A

Spending by the gov on current and capital items , at both local and national level

44
Q

Hot money

A

Money that is liable to rapid transfer from one country to another

45
Q

Human capital

A

The skills , abilities, knowledge and motivation of labour

46
Q

Imports

A

Purchase of g and s from abroad

47
Q

Income

A

A flow of income to a factor of production over a period of time e.g. Salary

48
Q

Index number

A

A number designed to be used to show the percentage changes in a variable over time , where 100 is the value in the base period

49
Q

Inflation

A

A persistent increase in the general price level

50
Q

Injection

A

Money that originates outside the circular flow of income and so boosts national income

51
Q

Interest rates

A

The cost of borrowing, the reward for saving or the opportunity cost of spending

52
Q

Investment

A

Spending by firms on new capital equipment

53
Q

Labour force

A

Those of working age who are either in work or actively seeking work

54
Q

Macroeconomic equilibrium

A

The level of national income where there is no tendency for it to rise and fall

55
Q

Monetary policy

A

Controlling the economy via changes in IR and the money suppply

56
Q

Mortgage

A

Loan to buy a property

57
Q

MPC

A

The monetary policy committee of the BoE who meet monthly to decide whether or not to alter the base rate of interest

58
Q

Money supply

A

The total amount of money in an economy

59
Q

Multiplier effect

A

Where an increase or decrease in spending leads to a larger then proportional change in national income

60
Q

Narrow money

A

Notes , coins and balances available for current transactions

61
Q

National debt

A

The stock of all outstanding government debt that has yet to be repaid

62
Q

National income

A

The total income generated within an economy over a period of time

63
Q

Negative equity

A

Situation where the value of ones house is lower than the outstanding mortgage

64
Q

Negative output gap

A

Where the economy is producing less than its trend output

65
Q

Nominal

A

Not adjusted for inflation

66
Q

Output gap

A

The difference between actual growth and trend growth

67
Q

Participation rate

A

Proportion of the country’s working age population that makes up the labour force

68
Q

Policy conflict

A

Where attempts to achieve one macro policy involves a trade off with another objective

69
Q

Positive output gap

A

When actual GDP exceeds the trend rate of GDP , increasing inflationary pressures

70
Q

Price level

A

The average level of prices of a range of g and s at a point in time

71
Q

Primary income

A

Flows of income from investments abroad minus flows of income from foreign investments in the U.K.

72
Q

Privatisation

A

Sale of government owned assets to the private sector

73
Q

Progressive tax

A

Whose on higher incomes pay a higher proportion of their income in tax compared with those on lower incomes

74
Q

Proportional tax

A

Where everyone pays the same proportion of their income in tax

75
Q

Real GDP

A

Gross domestic product, adjusted for the effects of inflation

76
Q

Recession

A

2 or more quarters of negative growth

77
Q

Recovery

A

When short run economic growth starts to increase after a recession

78
Q

Regressive tax

A

Where those on lower incomes pay a higher proportion of their income in tax compared with those on higher incomes

79
Q

Structural unemployment

A

Unemployment caused by a change in demand in an economy

80
Q

Subsidy

A

A payment made by government to producers to encourage greater production of a g or s

81
Q

Supply side improvements

A

Increases in an economy’s productive capacity arising out of businesses improving the efficiency of markets

82
Q

Supply side shock

A

Unexpected and significant changes in the price and / or availability of factors of production

83
Q

Tariff

A

A tax on imports

84
Q

Transmission mechanism

A

How changes in the rate of interest influence the components of AD

85
Q

Unemployment

A

Those of working age who are willing and able to work who do not currently have a job

86
Q

Unemployment rate

A

The number of unemployed people expressed as a percentage of the current labour force

87
Q

Unemployment trap

A

Where individuals receive more in benefit payments than they would in income in employment

88
Q

Wealth

A

A stock of owned assets e.g. Housing property , shares

89
Q

Wealth effect

A

Where a rise in the value of household wealth encourages consumers to spend more and save less

90
Q

Withdrawals

A

Money taken out of the circular flow of income, which reduces national income

Year 1 Micro (3 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions