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BU 111 > Textbook Chapter 2 > Flashcards

Textbook Chapter 2 Flashcards

1
Q

Can a single firm control the environment?

A

No, but managers should try to influence the environment

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2
Q

What is the economic environment?

A

Conditions of the economic system in which an organization operates

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3
Q

What is the business cycle?

A

A pattern of short-term ups and downs (expansions and contractions) in an economy

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4
Q

When does a depression occur?

A

When the trough of a business cycle extends two or more years

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5
Q

What is aggregate output?

A

Total quantity of goods and services produced by an economic system during a given period

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6
Q

What is standard of living?

A

Total quantity and quality of goods and services that a country’s citizens can purchase with the currency used in their economic system

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7
Q

What is Gross Domestic Product?

A

Total value of all goods and services produced within a given period by a national economy through domestic factors of production

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8
Q

What is Gross National Product?

A

Total value of all goods and services produced by a national economy within a given period regardless of where the factors of production are located

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9
Q

What is GDP per capita?

A

Gross domestic product per person

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10
Q

What is real GDP?

A

GDP calculated to account for changes in currency values and price changes

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11
Q

What is nominal GDP?

A

GDP measured in current dollars or with all components valued at current prices

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12
Q

What was Canada’s GDP in 2012?

A

1.7 trillion

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13
Q

What was the global GDP in 2012?

A

69 trillion

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14
Q

What were the five top countries in terms of GDP in 2012?

A

US, China, Japan, Germany, and France

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15
Q

What happens if GDP rises?

A

A nation experiences economic growth

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16
Q

Why is GDP a key measure of economic growth?

A

It tracks an economy’s performance over time

17
Q

What is the Genuine Progress Indicator?

A

A measure of GDP proposed by an organization called Redefining Progress that treats activities that harm the environment or our quality of life as costs and gives them negative values

18
Q

What is a real growth rate?

A

The real growth rate of GDP adjusts for inflation and changes in currency

19
Q

What does growth depend upon?

A

Output increasing at a faster rate than population: if the growth rate of GDP exceeds the rate of population growth, then our standard of living should be improving

20
Q

What is purchasing power parity?

A

The principle that exchange rates are set so that the prices of similar products in different countries are about the same

21
Q

What is productivity?

A

A measure of economic growth that compares how much a system produces with the resources needed to produce it

22
Q

What happens to your standard of living if the economic system increases its productivity?

A

The standard of living improves

23
Q

What is balance of trade?

A

The total of a country’s exports minus its imports

24
Q

What is national debt?

A

The total amount of money that a country owes to creditors

25
Q

What are budget deficits?

A

The result of the government spending more in one year than it takes in during that year

26
Q

What is the goal of an economic system?

A

Stability

27
Q

What is stability?

A

A condition in an economic system in which the amount of money available and the quantity of goods and services produced are growing at about the same rate

28
Q

What in inflation?

A

Occurrence of widespread price increases throughout an economic system

29
Q

What is the Consumer Price Index?

A

A measure of the prices of typical products purchased by consumers living in urban area

30
Q

What is deflation?

A

A period of generally falling prices

31
Q

What is unemployment?

A

The level of joblessness among people actively seeking work in an economic system

32
Q

What are fiscal policies?

A

Policies whereby governments collect and spend revenues

33
Q

What are monetary policies?

A

Policies whereby the government controls the size of the nation’s money supply (through interest)

BU 111 (11 decks)

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