Unit 3 Exam College Flashcards
Frictional unemployment
When workers spend time finding a job that suits their tastes and skills
Consumption
The total spending by households on goods and services
Employed
Paid employees, self-employed, and unpaid workers for a family business
GDP Deflator
100 x ( Nominal GDP / Real GDP )
CPI inclusion
Includes imported consumer goods
Excluded capital goods
Cyclical unemployment
The deviation of employment from its natural rate
Frictional Unemployment
When workers spend time finding a job that suits their tastes and skills
Consumer Price Index formula
100 x ( cost of basket in current year/Cost of basket in base year )
GDP Definition
The market value of all final goods and services produced in a country within a given period of time
Human Capital ( H )
The knowledge and skills workers acquire through education, training, and experience
GDP Deflator inclusion
Includes Capital Goods
Excludes imported consumer goods
Inflation Rate
100 x [ ( CPI this year - CPI last year )/ CPI last year ]
Money Multiplier
1/R
Labor Force
The total number of workers, including unemployed and employed
Natural Resources
The inputs into production that nature provides
National Savings/ Investment
Y-C-G
Government Purchases
Total spending on the goods and services purchased by the government at the federal, state, and local levels
GDP Equation
Y=C+G+I+NX ( Cows get in X-rays yearly )
Investment
Total spending on good that will be used in the future to produce more goods
Labor Force Participation Rate
100 x ( Labor force / Adult population )
Money Supply
The quantity of money available in the economy
Net Exports
Exports-Imports
Physical Capital
The stock of equipment and structures used to produce goods and services ( K )
Natural Rate of Employment
The normal rate of unemployment around which the actual unemployment fluctuates
Private Saving
Y-T-C
Production Function
Y=A x F( L, K, H, N )
Productivity
The average output of goods and services produced per unit of labor input ( Y / L )
Public Saving
T-G
Real Interest Rate
Nominal interest rate-Inflation rate
Structural Unemployment
When there are fewer jobs than workers
Technological Knowledge
Society’s understanding of the best ways to produce goods and services
Unemployed
Adults ( 16+ ) not working who have looked for a job in the last 4 weeks
Unemployment Rate
100 x ( # of unemployed / labor force )
If a country’s saving rate increases, then in the long run
Productivity and real GDP per person is higher
According to the definitions of national saving and private saving, if Y, C, and G remained the same, an increase in taxes would
Leave national saving unchanged and reduce private saving
The language of macroeconomics, investment refers to
The purchase of new capital
Property rights
The ability to exercise authority over the resources they own
For an economy as a whole, income must equal expenditure because
Every dollar of spending by some buyer is a dollar of income for some seller
