Economics Study Guide

Flashcards covering key definitions from the Economics Study Guide on productivity, trade, economic statements, and policy.

Average labor productivity

Output per worker.

Output per person (living standards)

Output ÷ population.

Trade surplus

A situation where exports are greater than imports.

Trade deficit

A situation where imports are greater than exports.

Ratio as % of exports (trade)

(Surplus or deficit ÷ exports) × 100%.

Positive statements (economics)

Testable, fact-based economic statements (e.g., 'If interest rates rise, demand falls').

Normative statements (economics)

Economic statements that involve value judgments (e.g., 'The Fed should raise rates').

Microeconomics

The study of individuals, firms, and markets.

Macroeconomics

The study of economy-wide issues like inflation, GDP, unemployment, and wages.

Output per capita

Total output ÷ population.

Labor productivity

Total output ÷ number of workers.

Monetary policy

Economic policy set by the central bank, focusing on interest rates and money supply.

Fiscal policy

Economic policy set by the government, focusing on taxes and spending.