GDP
This economic measure represents the market value of all goods and services produced within a country in a specific time period.
What is Gross Domestic Product (GDP)?
This term describes a worker who is actively searching for a job but has not yet found one.
What is unemployment?
The two main phases of the business cycle are known as these.
What are expansion and contraction?
This term describes the percentage change in the overall price level over time.
What is inflation?
This measure, calculated by the Bureau of Labor Statistics, tracks the cost of living based on a typical consumer’s spending patterns.
What is the Consumer Price Index (CPI)?
DP has three primary uses: measuring living standards, tracking economic growth, and determining whether an economy is in this phase.
What is a recession or expansion?
This formula calculates the unemployment rate by dividing the number of unemployed individuals by the labor force and multiplying by 100.
What is u = (Unemployed / Labor Force) × 100%?
Short-run fluctuations in economic activity around a long-term trend define this economic concept.
What is a business cycle?
An extremely high rate of inflation, often leading to economic instability, is known as this.
What is hyperinflation?
This government agency is responsible for calculating and reporting the CPI.
What is the Bureau of Labor Statistics (BLS)?
While one type of GDP is adjusted for inflation, this other type is not.
What is nominal GDP?
Unemployment is made of these three categories.
What are structural, frictional, and cyclical unemployment?
Indicators that predict future economic trends are called this, while those that change after the economy does are called this.
What are leading and lagging indicators?
While inflation refers to rising prices, this opposite phenomenon occurs when prices fall.
What is deflation?
The price index formula, which compares a basket of goods in different years, is calculated using this equation.
What is CPI = (Basket Price / Basket Price in Base Year) × 100?
This economic formula calculates GDP as the sum of these 4 categories of economic movement.
What is Y = C + I + G + NX?
When the actual unemployment rate (u) is greater than the natural rate (u), this phase of the business cycle is occurring.
What is a recession?
When a country is in a trade deficit, it is required to take out this to pay for their goods and services.
What is debt?
Examples of problems caused by inflation include shoe-leather costs, and menu costs. Name two more.
What are price level uncertainty, wealth redistribution, price confusion, tax distortions, money illusion?
Three reasons why CPI may overstate inflation include these changes to the economy.
What are substitution bias, quality changes, and the introduction of new products and locations?
Unlike newly produced goods, these items are not included in GDP calculations, as they were already counted in a previous year.
What are used goods?
The official unemployment rate does not account for these individuals, who have given up searching for work or are working part-time but want full-time jobs.
Who are discouraged workers and underemployed workers?
Although often seen as negative, a trade deficit allows a country to do this.
What is consume more goods and services?
This equation represents this fundamental economic concept, which assists in finding the inflation growth rate by isolating facets of the money supply.
What is M × V = P × Y?
This formula allows economists to compare the value of money across different years by adjusting for inflation.
What is Price in today’s dollars = Price earlier × (Price Index today / Price Index earlier)?