Economic Influences on Price Level and GDP

These flashcards cover key economic concepts related to the AD/AS model, monetary policy, and various types of economic influences discussed in the lecture.

AD/AS model

A model that represents the relationship between aggregate demand (AD) and aggregate supply (AS) in an economy, showing how economic influences impact price levels and GDP.

exogenous spending

Spending that is determined by factors outside of the market system, which can include government spending or changes in consumer confidence.

RBNZ monetary policy

The monetary policy set by the Reserve Bank of New Zealand aimed at regulating inflation and supporting economic growth.

nominal wages

Wages measured in current dollars, without adjusting for inflation.

supply capacity constraints

Limitations in production capabilities that can affect the supply of goods and services in an economy.

Official Cash Rate (OCR)

The interest rate set by the Reserve Bank of New Zealand that influences other interest rates in the economy.

inflation pressures

Forces that lead to an increase in the general price level of goods and services in an economy.

economic growth

The increase in the production of goods and services in an economy over a period of time.

consumer price inflation

The rate at which the general level of prices for goods and services rises, subsequently eroding purchasing power.

trade barriers

Government-imposed restrictions on international trade, such as tariffs or quotas, that can affect supply and prices.

geopolitical fragmentation

The process by which global economic relationships become divided, often due to political tensions, affecting global trade and investment.

net immigration

The difference between the number of immigrants and the number of emigrants in a country, which can impact labor supply and demand.

terms of trade

The ratio of export prices to import prices, which can indicate the purchasing power of a country's exports.

migration effects on economy

The impact that population movement has on the economy, influencing supply, demand, and inflation.

housing demand

The need for residential accommodations, which can be influenced by factors such as population growth and economic conditions.