MACRO DEFINITIONS: the measurement of macroeconomic performance

availability of credit

funds available for firms and households to borrow

base year

the first year in an economic financial index

black (informal, shadow) market

economic activities that occurs beneath the government's radar

claimant count

a method of measuring unemployment by counting all of those who claim the Jobseekers Allowance and other unemployment related benefits

Consumer Price Index (CPI)

Official measure used to calculate the rate of consumer price inflation, using a basket of common goods

credit crunch

occurs when there is low availability of credit in the economy

economic shock

unexpected events and their effect on economies - may be demand side or supply side

exchange rate

market value of all products produced per annum by the labour and property supply by the citizens of one country

exports

domestically produced goods and services sold to residents of other countries

full employment

all those willing and able to work are able to find jobs

Gross National Income (GNI)

sum of value added by all producers who reside in a nation, plus product taxes not included in the value of output, plus receipts of primary income from abroad

Gross National Product (GNP)

market value of all products produced per annum by the labour and property supplied by the citizens of one country

imports

non-domestically produced goods and services sold to residents of this country

index numbers

numbers allowing accurate comparisons over time to be made - the base year value is typically 100

inflation rate target

the CPI inflation rate target set by the government, which the Bank of England attempts to achieve - currently 2%

Job Seeker's Allowance (JSA)

unemployment-related benefit

Labour Force Survey

a quarterly survey of UK households, recording information on the personal employment circumstances of the respondents

liquidity

the ease with which as asset can be turned into cash without loss or delay

macroeconomics

involves the study of the whole economy at the aggregate level

macroeconomic stability

occurs when there is low volatility of key macroeconomic indicators

marginal propensity to consume (MPC)

the proportion of an increase in disposable income that is spend on consumer goods

national wealth

the stock of all goods with value in an economy

per capita

per person / per head

performance indicator

provides information used to judge success or failure of a government policy

policy instrument

tool or set of tools used to try and meet a policy objective

policy objective

target or goal policy-makers aim to hit

price index

an index number showing the extent to which a set of prices has changed in comparison to the prices in the base year

Purchasing Power Parity (PPP)

adjustments of exchange rates to reflect the actual purchasing power of a currency

Retail prices index (RPI)

an older measure used to calculate the rate of consumer price inflation

wealth

stock of assets

weighting

when certain data items in a set are assigned a higher or lower importance than other data items in the set