Studied by 8 people
Gross Domestic Product
The dollar value of all final goods and services produced in a country’s borders in a given year.
Intermediate Products
Goods and services that are used in the production of another good or service. Also called Intermediate Goods
Real GDP
The dollar value of all final goods and services produced in a country’s borders in a given year that has been adjusted for inflation.
Current/Nominal GDP
The dollar value of all final goods and services produced in a country’s borders in a given year that has not been adjusted for inflation. Also called Nominal GDP.
GNP (Gross National Product)
The dollar value of all final goods and services produced anywhere in the world by a country in a given year.
Net-Export of Goods and Services
The amount of exports minus the amount of imports.
Business Cycle
The idea that the economy goes through regular periods of expansion and contraction
Recession
1) A fall in a country’s GDP for a period of at least two quarters (6 months). 2) The portion of a business cycle in which GDP is declining, for this definition it can also be called contraction.
Peak
The portion of a business cycle in which GDP has stopped rising and is about to start declining.
Trough
The portion of a business cycle in which GDP has stopped declining and is about to start rising.
Expansion
The portion of a business cycle in which GDP is rising. Also called recovery.
Depression
A dramatic decline in a country’s GDP in a short period of time or a slower decline that lasts for an extended amount of time.
Inflation
A general decrease in the purchasing power of a currency. Alternately, can be expressed as a general increase in the prices of goods.
Deflation
A general increase in the purchasing power of a currency. Alternately, can be expressed as a general decrease in the prices of goods
Price Index
The average price of a statistically significant subset of all the goods and services in an economy.
Consumer Price Index
A tool used to measure inflation that is made up of a market basket of goods purchased by the typical urban family
Hyperinflation
Inflation that is out of control and rising rapidly.
Stagflation
A combination of rising inflation and a decrease in Gross Domestic Product.
Unemployed
When a willing worker is looking for a job and does not have a job
Labor Force
The total amount of all people in an economy who want to have a job
Frictional Unemployment
Unemployment that occurs because workers choose to change their status and make themselves unemployed
Structural Unemployment
Unemployment that occurs because changes in the economy have caused your skills to no longer match the needs of the market
Cyclical Unemployment
Unemployment that occurs because of downturns in the business cycle
Seasonal Unemployment
Unemployment that occurs because certain jobs are not available during some portion of the year
Member Bank
A bank that belongs to the Federal Reserve System
Interest on Reserve Balances (IORB)
The amount of interest earned by banks on any money that they deposit at the Federal Reserve.
Monetary Policy
The way in which the Federal Reserve adjusts and oversees the economy
Interest Rate
The percentage of the amount borrowed that you will be charged for taking out a loan.
Discount Rate
The amount of interest charged when banks borrow money from the Federal Reserve
Prime Rate
The amount of interest charged by banks to their best customers
Federal Reserve System
The central banking system of the United States
Note
Flashcard