Inflation
The percentage change in a price index.
What is inflation?
This is the bias caused by consumers when they spend their money at discount stores rather at the regular retail stores when prices rise.
What is the outlet bias?
The type of GDP that is determined by labor, capital, technology, and natural resources.
What is the potential GDP?
Someone who is enjoying retirement and not looking for work.
What is not in the labor force?
A Detroit Lions fan shop owner who has no customers between March and July and therefore closes his shop during that time period.
What is seasonal unemployment?
The vertical line in the AS/AD diagram.
What is Long-Run Aggregate Supply? What is potential GDP?
The most popular and most commonly used price index to inform us about the current inflation rate.
What is the Consumer Price Index (CPI)?
This is the reason why the latest iPhone 15 is not part of the current CPI basket.
What is "new product bias"?
This formula divides 70 by the growth rate and then tells us how many years it takes to double GDP.
What is the Rule of 70?
A high-school drop out who is applying for minimum-wage jobs.
What is being unemployed?
During an economic downturn, Party City lays of 15 percent of their work force.
What is cyclical unemployment?
The economic situation referred to as "stagflation" is caused by this shift.
What is a leftward shift of the SRAS curve?
The ratio of a nominal value over the price level.
What is the real value?
This is the reason why more people ride their bikes/walk/use public transportation when the price of gasoline rises.
What is substitution bias?
This exponent n in the formula
Future Value = Present Value x (1+g)^n
stands for this important variable.
What is years?
Anyone who is age 16 or older, not institutionalized, and not in the military.
What is the civilian working-age population?
A coal-mine worker whose place of employment has shut down because of environmental concerns.
What is structural unemployment?
The increase in real GDP that is accompanied by an increase in the price level is caused by this shift.
What is the rightward shift of the AD curve?
The sum of real interest rate and (expected) rate of inflation.
What is the nominal interest rate?
This is the bias in the CPI caused by the fact that improvements in products are not reflected in the market basket.
What is the quality bias?
The value of what is produced per worker or the value per hour of work.
What is productivity?
A mother who owns a home-day care.
What is employed?
A college graduate who looked for work last year has given up and is now living back in his parent's house.
What is a discouraged worker / not in the labor force?
The measure of the level of real GDP that is below the level of real potential GDP.
What is the recessionary gap?