Brainscape's Knowledge GenomeTM

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


See full index

A Level Economics > Macro Key Words > Flashcards

Macro Key Words Flashcards

1
Q

Absolute advantage

A

A country’s ability to produce a good using less resources than another country

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

Aggregate demand curve

A

The relationship between the level of aggregate demand and the overall price level; shows planned expenditure at any given possible overall price level

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

Appreciation

A

A rise in the exchange rate within a floating exchange rate system

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

Automatic stabilisers

A

Effects by which government expenditure adjusts to offset the effects of recession and boom without the need for active intervention

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

Average propensity to consume

A

The proportion of income that households devote to consumer expenditure

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

Balance of payments

A

A set of accounts showing the transactions conducted between residents of a country and the rest of the world

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

Bank rate

A

The interest rate that is set by the Monetary Policy Committee of the Bank of England in order to influence inflation

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

Canons of Taxation

A

Four maxims devised by Adam Smith, setting out the characteristics of a good tax

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

Capital account of the balance of payments

A

Account identifying transactions in (physical) capital between the residents of a country and the rest of the world

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

Capital productivity

A

Measure of output per unit of capital

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

Claimant count of unemployment

A

The number of people claiming the Jobseekers Allowance each month

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

Comparative advantage

A

A country’s ability to produce a good relatively more efficiently (I.e. at lower opportunity cost) than another country

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

Consumer price index (CPI)

A

A measure of the general level of prices in the UK, adopted as the government’s inflation target since December 2003

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

Consumption function

A

The relationship between consumer expenditure and disposable income; its position depends upon other factors that affect how much households spend on consumer expenditure

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

Cost-push inflation

A

Inflation initiated by an increase in the costs faced by firms, arising on the supply side of the economy

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

Current account of the balance of payments

A

Account identifying transactions in goods and services between the residents of a country and the rest of the world

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

Cyclical unemployment

A

Unemployment that arises during the downturn of the economic cycle, such as recession

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

Deflation

A

A situation in which the average level of prices is falling- this is negative inflation

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

Demand-deficient unemployment

A

Unemployment that arises because of a deficiency of aggregate demand in the economy, so that equilibrium level of output is below full employment

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

Demand pull inflation

A

Inflation initiated by an increase in aggregate demand

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

Depreciation

A

A fall in the exchange rate within a floating exchange rate system; a fall in value of physical capital equipment over time as it is subject to wear and tear

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

Devaluation

A

Process whereby a government reduces the price of its currency the price of its currency relative to an agreed rate in terms of forge in exchange

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

Discouraged workers

A

People who have been unable to find employment and who are no longer looking for work

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

Disposable income

A

The income that households have to devote to consumption and saving, taking into account payments of direct taxes and transfer payments

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

Economically inactive

A

Those people of working age who are not looking for work, for a variety of reasons

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

Effective exchange rate

A

The exchange rate for a country relative to a weighted average of currencies of its trading partners

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

Exchange rate

A

The price of one currency in terms of another

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

Exchange Rate Mechanism (ERM)

A

A system that was set up by a group of European countries in 1979 with the objective of keeping member countries’ currencies relatively stable against each other

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

Financial account of the balance of payments

A

Account identifying transactions in financial assets between the residents of a country and the rest of the world

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

Fiscal policy

A

Decisions made by the government on is expenditure, taxation and borrowing

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

Fixed exchange rate

A

A system in which the government of a country agrees to fix the value of its currency in terms of that of another country

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

Flat rate tax system

A

A system of income tax in which each taxpayer pays the same rate of tax on income

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

Floating exchange rate

A

A system in which the exchange rate is permitted to find its own level in the market

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

Forge in exchange reserves

A

Stocks of forge in currency and gold owned by the central bank of a country to enable it to meet any mismatch between the demand and supply of the country’s currency

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

Frictional unemployment

A

Unemployment associated with the job search: that is, people who are between jobs

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

Full employment

A

A situation where people who are economically active in the workforce and are willing and able to work (at going wage rates) are able to find employment

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

GDP per capita

A

The average level of PDG per head of population

38
Q

General Agreement on Tariffs and Trade (GATT)

A

The precursor of the WTO, which organised a series of ‘rounds’ of tariff reductions

39
Q

Globalisation

A

A process by which the world’s economies are becoming more closely interpreted

40
Q

Government budget deficit (surplus)

A

The balance between government spending and revenue

41
Q

Hot money

A

Stocks of funds that are moved around the world from country to country in search of the best return

42
Q

Human capital

A

The stock of skills and expertise that contribute to a worker’s productivity; can be increased through education and training

43
Q

ILO unemployment rate

A

Measure of the percentage of the workforce who are without jobs, but are available for work, willing to work and looking for work

44
Q

In employment

A

People who are either working for firms or other organisations, or are self-employed

45
Q

Index number

A

A device for comparing the value of a variable in one period or location with a base observation (e.g. The retail price index measures the average level of prices relative to a base period)

46
Q

Inflation

A

The rate of change of the average price levels: for example, the percentage annual rate of change of the CPI

47
Q

Inflation targeting

A

An approach to macroeconomic policy whereby that central bank is charged with meeting a target for inflation

48
Q

Investment

A

Expenditure undertaken by firms to add to the capital stock

49
Q

Invisible trade

A

Trade in services

50
Q

Involuntary unemployment

A

Situation arising when an individual who would like to accept a job at the going wage rate is unable to find employment

51
Q

Keynesian school

A

A group of economists who believed that the macroeconomy could settle at an equilibrium that was below full employment

52
Q

Labour productivity

A

Measure of output per worker, or output per hour worked

53
Q

Law of comparative advantage

A

A theory arguing that there may be gains from trade arising when countries specialise in the production of goods and services in which they have a comparative advantage

54
Q

Long-run economic growth

A

The expansion of the productive capacity of an economy

55
Q

Macroeconomics

A

The study of the interrelationships between economic variables at an aggregate (macroeconomic) level

56
Q

Marginal propensity to consume

A

The proportion of additional income devoted to consumer expenditure

57
Q

Marginal propensity to import

A

The proportion of additional income that is spent on imports of goods and services

58
Q

Marginal propensity to save

A

The proportion of additional income that is saved by households

59
Q

Marginal propensity to tax

A

The proportion of additional income that is taxes

60
Q

Marginal propensity to withdraw

A

The proportion of additional income that is withdrawn from the circular flow- the sum of the marginal propensity to save, import and tax

61
Q

Monetarist school

A

A group of economists who believed that the macroeconomy always adjusts rapidly to the full employment level of output

62
Q

Monetary policy

A

The decisions made by the government regarding monetary variable ms such as the money supply and the interest rate

63
Q

Monetary Policy Committee

A

Body within the Bank of England responsible for the conduct of monetary policy

64
Q

Money stock

A

The quantity of money in the economy

65
Q

Multinational corporation (MNC)

A

A company whose production activities are carried out in more than one country

66
Q

Multiplier

A

The ratio of a change in equilibrium real income to the autonomous change that brought it about; it is defined as 1 divided by the marginal propensity to withdraw

67
Q

Natural rate of output

A

The long-run equilibrium level of output to which monetarists believe the macroeconomy will always tend; corresponds to full employment

68
Q

Net investment

A

Gross investment minus depreciation

69
Q

Nominal value

A

Value of an economic variable based on current prices, taking no account for changing prices through time

70
Q

Productivity

A

Measure of the efficiency of a factor of production

71
Q

Purchasing power parity theory of exchange rates

A

Theory stating that in the long run exchange rates (in a floating rate system) are determined by relative inflation rates in different countries

72
Q

Quantitative easing

A

A process by which the central bank purchases assets such as the government and corporate bonds in order to release additional money into the financial system

73
Q

Real exchange rate

A

The nominal exchange rate adjusted for differences in relative exchange rates between countries

74
Q

Real value

A

Value of an economic variable, taking into account changing prices through time

75
Q

Recession

A

Occurs when GDP falls for two or more consecutive quarters

76
Q

Retail price index (RPI)

A

A measure of the average price level in the UK

77
Q

Revaluation

A

Process whereby a government raises the price of domestic currency in terms of forge in currency

78
Q

Seasonal employment

A

Unemployment that arises in seasons of the year when demand is relatively low

79
Q

Short-run aggregate supply curve

A

A curve showing how much output firms would be prepared to supply in the short run at any given overall price level

80
Q

Short-run economic growth

A

An increase in the actual GDP

81
Q

Structural unemployment

A

Unemployment arising because of changes in the pattern of economic activity within an economy

82
Q

Supply-side policies

A

Range of measures intended to have a direct impact on aggregate supply- and specifically the potential capacity output of the economy

83
Q

Sustainable development

A

Development that meets the needs of the present without compromising the ability of future generations to meet their own needs

84
Q

Terms of trade

A

The relative prices at which exchange takes place; the ratio of export prices to import prices

85
Q

Total factor productivity

A

The average productivity of all factors, measured as the total output divided by the total amount of outputs used

86
Q

Trading possibility curve

A

Show the consumption possibilities under conditions of free trade

87
Q

Unemployed

A

People who are economically active but not in employment

88
Q

Visible trade

A

Trade in goods

89
Q

Voluntary unemployment

A

Situation arising when an individual chooses not to accept a job at the going wage rate

90
Q

Workforce

A

People who are economically active- either in employment or unemployment

91
Q

World Trade Organisation (WTO)

A

A multilateral body now responsible for overseeing the conduct of international trade

A Level Economics (15 decks)

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