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28 Cards in this Set
- Front
- Back
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macroeconomy
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the total economy
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macroeconomics
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the study of the total economy
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microeconomics
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the study of individual aspects within the total economy
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gross domestic product (GDP)
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total output in an economy
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recession
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A decline in a nation's gross domestic product (output) associated with a rise in unemployment. Technically, there must be a decline in real GDP for at least two consecutive quarters.
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labor force
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all people age 16 and older who are working for pay or actively seeking employment
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labor force participation rate
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the ratio of the number of people in the labor force to the number of people age 16 or older in the population
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unemployment rate
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the percentage of the labor force that is unemployed
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unemployed person
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a person age 16 or older who is actively seeking employment but is unable to find a job
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discouraged workers
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people who would like to work, but have become so discouraged in the job search that they have stopped actively seeking employment
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frictional unemployment
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temporary unemployment caused by a normal time delay when a person seeks a first job, changes jobs, or re-enters the labor force after an absence
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structural unemployment
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unemployment that results from structural changes in our economy, such as changes in demand or technology
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cyclical unemployment
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unemployment that results from a drop in economic activity in our economy as a whole
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full employment
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a situation in which there is no cyclical unemployment; all unemployment is frictional or structural
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minimum wage
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a legally imposed minimum price (wage) for labor
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price floor
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a legally imposed minimum for a good or service
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earned income tax credit (EITC)
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a federal income tax credit for low-income workers and families
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inflation
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a rise in the average price level
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delfation
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a decrease in the average price level
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consumer price index (CPI)
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a weighted average of the prices of a fixed basket of goods and services purchased by a typical urban household
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cost-of-living adjustment
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an adjustment that automatically increases incomes or benefits when the average price level rises
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barter
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the direct exchange of goods and services for other goods and services rather than for money
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hyperinflation
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extremely high inflation whereby money becomes almost worthless
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purchasing power
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the ability to buy goods and services
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menu costs
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the costs associated with reprinting menus, revising cost schedules, adjusting telephones and vending machines, and so on, when inflation occurs
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demand-pull inflation
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inflation that occurs when any sectors of the economy increase their demand for goods and services
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cost-push inflation
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inflation that occurs as a result of increases in the costs of production
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profit-push inflation
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inflation that occurs when businesses use market power to restrict output in order to push up prices and profits
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