Measuring Economic Performance Flashcards

1
Q

what are the four main economic indicators

A
  • Growth
  • Inflation
  • Unemployment
  • Balance of Payments
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2
Q

What are the two way output can be measured

A

Volume - quantity produced in a year
Value - Value of all things produced in a year

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3
Q

what is economic growth

A

rate of change of GDP

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4
Q

GDP

A

total value of the national output in a year

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5
Q

What is the difference between nominal and real GDP

A

Nominal - Not adjusted for inflation
Real - Without effect of inflation

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6
Q

What does the GDP per Capita indicate

A

Standard of living

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7
Q

Gross National Income

A

GDP plus net income from other assets owned abroad

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8
Q

Gross National Product

A

total output of citizens in a country regardless of whether they reside there

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9
Q

What is Purchasing Power Parity

A

real value of an amount of money in terms of what can actually be bought with it. Differs country to country due to stronger or weaker exchange rates.

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10
Q

Limitations of GDP in comparisons

A
  • Doesn’t account for hidden economy
  • Some Governments use more public spending to increase living standards.
  • Doesn’t show distribution of income
  • Other factors like damage to environment or working conditions
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11
Q

What is Happiness Economics

A

Measures subjective wellbeing in how satisfied people are with their lives.

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12
Q

Relationship between real income and subjective happiness

A

They both rise together but at a point happiness will cease to rise while income still rises, Easterlin paradox

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13
Q

What is the UK National Well-Being programme

A

Records statistics for personal wellbeing areas like health and relationships

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