Business Cycle
The alternating periods of growth and decline which the economy undergoes are called the
Business Cycle
the increasing of prices over time
What is formula for GDP?
GDP= C+I+G+NX .... or C+I+G+(X-M)
How a government taxes and spends money (local, state, U.S.)
Economy is improving
Consumers buy more
Business activity is increasing
Expansion
the total value (in dollars) of everything produced in the USA each year
What is full employment? What is healthy unemployment?
What is around 95%. Then 4-5%
How just the FEDERAL government regulates the amount of money in circulation
monetary policy
Economic activity peaks
Businesses work at full capacity
Stores sell at record amounts
Peak
Change in price over time of a specific group of goods and services the average household uses
Consumer Price Index (CPI)
What is normal unemployment rate?
What is 4-5%?
Describe the difference between government expenditures and revenue
expenditures: money spent
Revenue: money brought in
Economy slows down
Production cut
Workers laid off
contraction
Institution that sets monetary policy
FED
The best Thai restaurant in town purchases ties for its employees? Does it effect GDP? Which component? Increase or Decrease
What is Yes, What is I - Investment, Up
tax is charged on the production and consumption of particular goods and services
excise tax
Lowest period for production – economic decline for 6 straight months or more
High unemployment
Low consumer spending
Trough
List the 4 main types of unemployment economists identify
Structural unemployment
Frictional unemployment
Seasonal unemployment
Cyclical unemployment
What is healthy inflation rate?
What is 2%?
charged on the sale of goods or services
AND what is NC's
sales tax
6.75%