Macroeconomics for 31st Jan Macro BT Flashcards

1
Q

Economic growth

A

Increase in real GDP

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2
Q

Price stability

A

When inflation is low and stable. UK target is at 2%.

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3
Q

Unemployment

A

The number of people actively seeking employment but are unable to find work.

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4
Q

BoP

A

Ensuring exports and imports are balanced, reducing deficits or surpluses on the current account.

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5
Q

AD

A

Total spending on goods and services in the economy at a given price level

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6
Q

AD =

A

C + I + G + (X - M)

C - Consumption
I - Investment
G - Government Spending
X - Exports
M - Imports

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7
Q

LRAS

A

Determined by factors like productivity, technology, and institutional structure.

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8
Q

SRAS

A

Changes in costs of production. (wages, raw materials, taxes) will shift the curve.

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9
Q

Shift in AD

A

Caused by changes in C, I, G, X and M

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10
Q

Shift in AS

A

Caused by changes in costs of production or productivity, technology, and labour mobility.

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11
Q

Short Run economic growth

A

Caused by increased utilization of existing resources (e.g, demand - side policies)

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12
Q

Long Run Economic Growth

A

Sustained by increasing productive capacity (e.g, investment in tech and education).

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13
Q

Boom

A

High growth, low unemployment, inflationary pressures

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14
Q

Recession

A

Negative growth, high unemployment, deflation risk.

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15
Q

Recovery

A

Positive growth resumes.

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16
Q

Slump

A

Low growth, high unemployment, stagnation.

17
Q

Positive output gap

A

Actual GDP > Potential GDP

18
Q

Negative Output Gap

A

Actual GDP < Potential GDP

19
Q

NI Data

A

Total value of goods and services produced in the economy in a given time period