2.1
The model that shows the flow of goods and services between households and firms
What is the Circular Flow Model
Goods and services that provide value but don't count in gdp
What are nonmarket transactions
A general increase in prices and fall in the purchasing value of money
What is inflation
Wage/GDP that is measured by dollars rather than purchasing power
What is Nominal GDP
GDP that is adjusted for inflation
What is Real GDP
The four main categories in the production process
What are the factors of production
Something that is not counted in GDP
What are used goods and services or black market goods
Decrease in general prices or a negative inflation rate
What is deflation
People that are hurt by unexpected inflation
What is a lender
GDP deflator equation
GDP Deflator = Nominal GDP / Real GDP x 100
The total market value of all goods and services produced within a country
What is GDP
Workers are are actively looking for a job but aren't working
What is unemployment
The most common way to measure inflation
What is the Consumer Price Index (CPI)
People that are helped by unexpected inflation
What is a borrower
The highest point on the buissness cycle
What is a peak
The component of GDP that makes up for total spending by households on goods and services
Consumption spending
Unemployment caused by a recession
What is cyclical unemployment
Cost of all goods and services produced in one year
What is a market basket
When prices accelerate super fast and cause super high inflation
What is hyperinflation
A graph that shows the fluctuations of the economy over time
What is the business cycle
The formula that calculates GDP
GDP = C + I + G + XN
Frictional plus structural unemployment, the amount of unemployment that's exists when the economy is healthy
What is the natural rate of unemployment
Index numbers assigned to each year that show how prices have changed relative to a specific base year
What are price indices
Calculated by dividing a country's GDP by its population
What is GDP per Capita
Measure of the money price of all new, domestically produced, final goods and services in an economy in a year relative to the real value of them.
What is the GDP deflator