Vocab 1
Unemployment caused by change in seasons
Seasonal Unemployment
unemployment caused by transferring from one job to the next
frictional unemployment
Household economics or the study of everyday economic decision making
Microeconomics
THICC Economics
when you can produce the most of a resource or good you have an
absolute advantage
Unemployment caused by changes in innovation
structural unemployment
unemployment related to contractions in the business cycle
cyclical unemployment
unlimited wants but limited resources is the basic problem of
scarcity
trade off
the next best option you give up when you make a choice
opportunity cost
GDP accounting for inflation
Real GDP
GDP NOT accounting for inflation
Nominal GDP
amount of goods and services produced in an economy
aggregate supply
amount of goods and services consumed in an economy
aggregate demand
when you can produce a good with the lowest opportunity cost
comparative advantage
wages and resources will NOT increase as price level increases
short run agg. supply
wages and resources WILL increase as price levels rise
long run agg. supply
Consumer Price Index
Increase in general prices
inflation
1. Work demand rises
2. Prices increase to account for demand
3. Workers demand more due to price increases and increased profits
4. Cycle repeats
Wage-Price Spiral
Price B - Price A/Price A x 100 =
G + I + C + xN = ___
GDP
Profit
Nominal GDP/Real GDP x 100 =
Four parts of the business cycle
Peak, Expansion, Trough, Contraction