Measuring Economic Performance Flashcards
What are the four main macroeconomic indicators?
Economic growth
Inflation
Unemployment
Balance of payments
What are the 2 ways output can be measured?
Adding up the amount of goods and services produced in a year
Adding up the value of all the goods and services produced in a year
What is economic growth usually measured as?
A percentage change
What is the formula for calculating economic growth as a percentage?
(Change in GDP/ Original GDP) x 100
What is the formula for GDP per capita?
Total GDP/ Population size
What is inflation?
The sustained rise in the average price of goods and services over a period of time
What is deflation?
When the average price of goods and services is actually decreasing
What is disinflation?
When the rate of inflation is slowing down. Prices are still rising, but at a slower rate
What 2 surveys are carried out to calculate RPI?
Living costs and food survey, Change in prices of 700 of the most commonly used goods and services
What is the living costs and food survey?
A survey used to find out what people spend their money on, and what proportion of income is spent on these items
What is excluded from CPI calculations?
Mortgage interest payments
Council Tax
What is unemployment?
The number of people who are looking for a job but cannot find one
What are the 2 ways of measuring unemployment?
The claimant count
The Labour force survey
What is the claimant count?
The number of people claiming unemployment related benefits from the government
What is the labour force survey?
The international labour organisation uses a sample of the population to ask if they are looking for work or not
