GDP
What does GDP stand for?
What is Gross Domestic Product - Gross meaning 'All', Domestic meaning 'in the USA', and Product meaning 'all goods and services.'
The top point of a business cycle is called this _______. While the bottom point is referred to as this _______.
What is the peak and the trough?
Income not used for consumption is referred to as this.
What is Savings?
The average of all prices of all products in the economy is known as this.
What is price level?
A steady, long-term increase in GDP is known as this.
What is economic growth?
These are the 2 different ways to measure GDP.
What is Expenditure and Income? Expenditure consists of all sales of good/services. Income consists of all incomes in the economy.
A prolonged economic contraction leads to this ________. And an even longer contraction will lead to this ________.
What is a recession? What is a depression?
These are 2 examples that the gov't promotes technological progress/economic growth.
What is patents and basic research?
What effect does fear about the economy have on consumers?
What is consumers will decrease spending and save more. GDP will be reduced in the short run.
Name at least three other measurements of standard of living that we learned in class?
What is ?
This measurement calculates GDP using a base year, and is frequently used by economists in determining whether the U.S. economy is growing from year to year.
What is Real GDP?
A decline the Real GDP coupled with an increase in the price level is known as this.
What is stagflation?
Capital deepening is an increase in capital per worker. Give 2 ways (physical) and (human) that capital can deepen.
What is physical (buy new computers, buildings, factories) human (more education)?
To calculate disposable income, you subtract this from personal income.
What is personal income taxes?
Provide both an example of a nondurable and durable good.
What is nondurable - a notebook and durable - a car
They say that once you drive a new car off the lot of a dealership, the price drops 10%-20%. This is an example of this.
What is depreciation?
Name at least 3 out of 4 of the leading economic variables.
What is external shocks, consumer expectations, interest rates, and business investment?
Economists determine a country's standard of living by using this measurement.
What is GPD per Capita
The proportion of disposable income that is saved is this.
What is the savings rate?
The government uses this to calculate our GDP
What is the National Income and Accounting System.
When drawing an Aggregate Supply Curve and an Aggregate Demand Curve, this is written on the y-axis, and this is written on the x-axis.
What is y - price level and x - Real GDP
Provide both an example of a positive and negative economic shock.
What is Positive - great weather leading to better crop yields. Negative - War, Natural Disaster
Higher savings leads to economic growth. How?
What is more capital is available for investment, which then leads to capital deepening.
Imports of these types of goods will lead to economic growth.
What is long-term capital investment
An international crisis has caused consumers to save their money and postpone big purchases. This will have this effect on Aggregate Demand and GDP.
What is Aggregate Demand will decrease and GDP will decrease.