Front Back
GDP
everything PRODUCED w/in economy -total market value of final goods & services produced w/in economy in given year
aggregate expenditures
breakdown of production by types of agens (households, firms, government) that buy goods
consumption expenditures
purchases of newly produced goods & services by households (except housing)
private investment expenditures
purchases of newly produced goods & services by firms (including housing)
transfer payments
payments from gov to individuals that do not correspond to production of goods & services -not included in GDP -ex: welfare, unemployment, SS
aggregate expenditure approach
GDP divided among purchasers
value added approach
GDP divided among producers -sum of all income generated by organization, regardless whether or not producing final good/service
income distribution
-3/4 households in top 5% have two income earners -some of rise in household income distribution has to do w/ changing makeup of households & w/ changes in types of jobs held by women earners in some of those households -much more of household income in top quintile comes from capital (…
labor force
total # workers, employed + unemployed
unemployment rate
percentage of labor force that's unemployed
labor force participation rate
percentage of population over 16 that's in labor force
cyclical unemployment
unemployment that occurs during fluctuations in real GDP
frictional unemployment
unemployment that occurs w/ normal workings of economy, workers taking time to search for suitable jobs & firms taking time to search for qualified employees
structural unemployment
unemployment that occurs when mismatch of skills & jobs
natural rate unemployment
level of unemployment at which there is NO cyclical unemployment (only frictional & structural)
full employment
level of unemployment that occurs when unemployment rate is at natural rate
CPI
price index, measures cost of fixed basket of goods over time; fixed basket chosen to represent consumption pattern of typical consumer in base year
real wages
wages/CPI
problems w/ CPI
-overestimates inflation bc of substitution bias (CPI assumes people buy same basket of goods as in base year but people substitute out goods whose prices have risen since base year) -CPI worse estimate of cost of living farther away you get from base year
stock of capital
total of all machines, equipment & buildings in an entire economy
rule of 70
number will double in 70/x yeasrs, x is percentage rate of growth
capital deepening
increases in stock or quality of capital per worker
technological progress
more efficient ways or organizing economic affairs that allow an economy to increase output w/o increasing capital or labor inputs
growth accounting
method to determine contribution to economic growth from increased capital, labor & technological progress -gov measures Y, K, L & backs out contribution for K assuming certain production function for GDP

Access the best Study Guides, Lecture Notes and Practice Exams

Login

Join to view and access 3M+ class-specific study document.

or
We will never post anything without your permission.
Don't have an account?
Sign Up

Join to view 2 2 and access 3M+ class-specific study document.

or

By creating an account you agree to our Privacy Policy and Terms Of Use

Already a member?