IB Economics - Definitions

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disposable income

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5 Terms

1

disposable income

the rewards from direct and indirect contribution to the production process plus government transfers minus (direct) income taxes

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2

inflation

a sustained increase in the general level of prices over a period of time

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3

unemployment

the situation where individuals who are capable and willing to work cannot find a job.

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4

underemployment

total number of people in an economy who are unwillingly working in low-skill and low-paying jobs or only part-time because they cannot get full-time jobs that use their skills.

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5

real rate of interest equation

nominal interest rate - rate of inflation

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