Study Guide for Econ Ch 2+3

GDP

market value of all final goods and services produced and sold in a country within a time period

Real GDP

measures values using the prices of a base year

nominal GDP

measures values using current prices

nominal GDP

which gdp changes are due to changes in prices AND quantities

real GDP

which gdp changes due to only changes in prices

CPI

measure of the overall level of prices

unemployment rate

what does this mean: unemployment rate = unemp/labor force x 100

CPI

what is used to track changes in typical household cost of living and adjusts many contracts for inflation

labor force

= employed + unemployed

trade deficit

what does negative net exports mean?

trade surplus

what does positive net exports mean?

Marginal product of labor

the extra output the firm can produce using an additional unit of labor

national saving

= private saving + public saving

flow

is investment flow or stock?

stock

is capital stock or flow?

gdp deflator

nominal gdp/real gdp x 100

gross national product

total income earned by the nation’s factors of production regardless of location

gross domestic product

total income earned by domestically-located factors of production (regardless of nationality)

substitution bias

cpi problem SB

introduction of new goods

cpi problem ING

unmeasured changes in quality

cpi problem UCQ

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