Economics theme 2 (Macro)

Pregunta	Respuesta
Economic Growth	An increase in real GDP or potential GDP
GDP	The total value of output of goods and services produced in a country in one year
Nominal GDP	Total value of output at current prices. No adjustment for the effects of inflation. Known as raw data.
Inflation	A general and persistent increase in the price level
Real GDP	This is GDP at constant prices, adjusting GDP to take into account the effects of inflation. Known as adjusted data.
Recession	2 consecutive quarters of negative economic growth.
Economic Slowdown	A general reduction in a country's economic activity.
GDP Per Capita	Total GDP divided by the population
GNI	Gross National Income= GDP plus net income from abroad
Deflation	A general and persistent decrease in the price level
Disinflation	A decrease in the rate of inflation. (Prices are still going up)
CPI	Consumers Price index- the measure adopted by the Government for its UK inflation target. The Bank of England is required to achieve a target of 2%.
How is CPI calculated?	1. Annual expenditure survey 2. Monthly price survey
RPI	Retail Price index- Takes into account household spending eg. Mortgage payments
Basket of goods	A relatively fixed set of consumer products and services valued and used on an annual basis to track inflation in a specific market or country. Used to calculate the CPI.
Unemployment	When an individual is willing and able to work but is not currently employed. They must also be economically active.
Economically inactive	Not looking for work in any shape or form
How is unemployment measured?	1. ILO 2. Claimant Count
ILO	Labour Force Survey (LFS) - Telephone or household survey on 60,000 households. Interviewed 5 times in 3 month intervals. It is internationally recognised.
Claimant Count	Monthly count of those claiming unemployment benefit
Under-employed	A situation where the worker is employed but wants to work more hours
Migration	Movement of a person from one country, of a substance from one medium, or of data from one format, platform, or system, to another.
The balance of payments	A record of international payments over the course of one year.
What is the balance of payments made up of?	1. The current account 2. The Capital account
Current account	Refers to a country's earnings/spending abroad.
Capital account	Refers to the inflow and outflow of funds.
Current account of the balance of payments	A record of a country's trade of exports, imports, investment income and current transfers with the rest of the world.
What is the balance of trade made up of?	1. Trade in goods 2. Trade in services
Surplus	Earning more than you are spending abroad
Deficit	Spending more than you are earning abroad
Exports	To send goods or services across national frontiers for the purpose of selling and realizing foreign exchange. Money flows into the country ( a positive '+' sign on the current account)
Imports	Products of foreign origin brought into a country. Money flows out of the country ( a negative '-' sign on the current account)
Investment income	Capital gains, dividends, interest, and rent generated by investment, and not by trading activities. Also called unearned income, investment income is generally taxable.
Current transfers	Refers to the transfers of money either into or out of a country. Transfers where there is no quid pro quo (nothing in return)
Appreciation	Increase in the value of an asset which is in excess of the asset's depreciable cost, and is due to economic and other factors (such as scarcity or inflation) and not due to additions or improvements made to it.
Depreciation	The decrease in the economic potential of an asset over its productive or useful life.
Aggregate Demand	The total planned spending on UK produced goods and services by households, firms, the Government and the foreign sector.
Investment (Aggregate demand)	Spending by firms on capital
Consumption (Aggregate demand)	Spending by households on consumer goods (60%)
Exports (Aggregate demand)	Spending by foreigners on UK produce
Imports (Aggregate demand)	Spending by UK on foreign products
Government spending (Aggregate demand)	Public sector spending (20%)
What is consumption affected by?	1. Income 2. Interest rates 3. Consumer borrowing 4. Consumer confidence 5. Wealth
Disposable income	Gross income of an individual or firm from which direct taxes (such as PAYE, income tax) have been deducted.
Discretionary income	Portion of an entity's income available for saving, or spending on non-essentials. It is what remains after expenses for basics (such as food, clothing, shelter, utilities) and prior commitments (such as school fees and loans, interest) are deducted from the disposable income.
Consumer confidence	An economic indicator that gauges how consumers interpret the present economic environment and their expectations for the future.
Positive wealth effect	This occurs when times of wealth rise in value
Negative wealth effect	A reduction in wealth leading to a reduction in consumption.
Negative equity	When the value of an asset falls below the outstanding balance on the loan used to purchase that asset.

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	Creado por Libby Rose hace alrededor de 9 años