Measurement of Macroeconomic Performance

Question 1

BIGFEET

Answer 1

The main macroeconomic objectives that a government may seek to achieve in an economy. Including economic growth, low stable inflation, equity, balance of tax + government spending, environmental quality, equilibrium of the current account of the balance of payments

Question 2

Long Run Economic Growth

Answer 2

An increased in the economy potential level of real output + outward shift of the economy’s PPF

Question 3

Short run Economic Growth

Answer 3

Growth of real output resulting from using idle resources eg labour taking up slack in an economy

Question 4

GDP

Answer 4

The total value of goods + services produced within the boundaries/frontiers of an economy in a given time period

Question 5

GNP

Answer 5

GDP + Net property income from abroad (net earnings of citizens abroad)

Question 6

Nominal GDP

Answer 6

GDP without adjusting for inflation

Question 7

Real GDP

Answer 7

Measure of all goods + services produced adjusted for inflation

Question 8

Claimant Count

Answer 8

The number of people claiming unemployment benefits

Question 9

Labour Force Survey

Answer 9

A sample survey, information on the labour market to give an idea of unemployment levels in a given time

Question 10

Export

Answer 10

Domestically produced goods or services sold to other countries. Positive on balance of payments

Question 11

Import

Answer 11

Goods or services produced abroad and sold to the residents of this country

Question 12

Balance of Trade

Answer 12

Largest part of balance of payments on the current account, the difference between value of imports + exports

Question 13

Visible Trade

Answer 13

Trade in goods eg raw materials, component parts

Question 13

Balance of Trade Deficit

Answer 13

Money value of exports is greater than imports

Question 14

Balance of Trade Surplus

Answer 14

Money value of imports is greater than exports

Question 15

Balance of Payments

Answer 15

All the currency flows into + out of a country in a particular time period

Question 16

Current Account

Answer 16

All payments for exports + imports of goods + services

Question 17

Financial Account

Answer 17

All transactions for transfer of ownership of financial assets between countries

Question 18

Current Account of the Balance of Payments

Answer 18

All currency flows in + out of a country in a period of time

Question 19

Net Property Income from Abroad

Answer 19

Earning of a country’s citizens overseas - earnings of foreigners in that country

Question 20

National Income

Answer 20

Measures monetary value of flow of goods + services produced by factors of production owned by citizens of an economy.
GDP - Depreciation = National Income

Question 21

Depreciation

Answer 21

Capital losing value due to wear + tear. The cost of replacing or repairing capital