Macro

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Gross domestic product (GDP)

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It is the monetary value of all the finished goods and services produced within a country's borders in a specific time period. Though GDP is usually calculated on an annual basis, it can be calculated on a quarterly basis as well.

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Inflation rate (consumer prices)

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7.7% (2013 est.) 9.7% (2012 est.) Definition: This entry furnishes the annual percent change in consumer prices compared with the previous year's consumer prices.

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Unemployment rate

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The unemployment rate is a measure of the prevalence of unemployment and it is calculated as a percentage by dividing the number of unemployed individuals by all individuals currently in the labor force. During periods of recession, an economy usually experiences a relatively high unemployment rate.

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Endogenous Variables

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Dependent variable generated within a model and, therefore, a variable whose value is changed (determined) by one of the functional relationships in that model. For example, consumption expenditure and income is considered endogenous to a model of income determination. See also exogenous variable.

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Those variables that a model tries to explain.

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Exogenous variable

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A factor in a causal model or causal system whose value is independent from the states of other variables in the system; a factor whose value is determined by factors or variables outside the causal system under study.

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Those variables that a model takes as given.

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Market clearing

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In economics, market clearing is the process by which, in an economic market, the supply of whatever is traded is equated to the demand, so that there is no leftover supply or demand. The new classical economics assumes that, in any given market, prices always adjust up or down to ensure market clearing.

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Macro-economics

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The branch of economics concerned with large-scale or general economic factors, such as interest rates and national productivity.

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Stock

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The goods or merchandise kept on the premises of a shop or warehouse and available for sale or distribution.

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It is a quantity measured at a given point in time.

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Flow

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It is a quantity measured per unit of time.

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Imputed Value

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'Imputed Value' The value of an item for which actual values are not available. Imputed values are a logical or implicit value for an item, or time set, wherein a "true" value has yet to be ascertained.

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GDP deflator / implicit price deflator for GDP

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The GDP deflator (implicit price deflator) is a measure of the level of prices of all new, domestically produced, final goods and services in an economy. GDP stands for gross domestic product, the total value of all final goods and services produced within that economy during a specified period.

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Base year

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A base year is the year used for comparison for the level of a particular economic index. The arbitrary level of 100 is selected so that percentage changes (either rising or falling) can be easily depicted.

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Chain weighted measures

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A measurement used as an alternative to the Consumer Price Index that removes any biases related to new products, any changes in quality, and discounted pricing. The chain weighted CPI (Consumer Price Index) incorporates the average chances in the quantity of products purchases, in addition to the standard pricing effects.

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National income accounting

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National income accounting is a term used in economics to refer to the bookkeeping system that a national government uses to measure the level of the country's economic activity in a given time period. National income accounting records the level of activity in accounts such as total revenues earned by domestic corporations, wages paid to foreign and domestic workers, and the amount spent on sales and income taxes by corporations and individuals residing in the country.

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Consumption

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Consumption, in economics, the use of goods and services by households. Consumption is distinct from consumption expenditure, which is the purchase of goods and services for use by households.

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Investment

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An investment is an asset or item that is purchased with the hope that it will generate income or appreciate in the future. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth.

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Government purchases

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Government purchases are expenditures made in the private sector by all levels of government, such as when a government entity contracts a construction company to build office space or pave highways.

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Net exports

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Net exports refer to the value of a country's total exports minus the value of its total imports. It is used to calculate a country's aggregate expenditures, or GDP, in an open economy.

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Consumption of fixed capital

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Consumption of fixed capital is the decline, during the. course of the accounting period, in the current value of. the stock of fixed assets owned and used by a producer as. a result of physical deterioration, normal obsolescence or.

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National income

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A variety of measures of national income and output are used in economics to estimate total economic activity in a country or region, including gross domestic product (GDP), gross national product (GNP), net national income (NNI), and adjusted national income (NNI* adjusted for natural resource depletion).

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statistical discrepancy

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Statistical discrepancy is the difference between demand and supply in na-tional accounts. Even though by definition the items should be equal in the national economy, they usually deviate from one another due to deviation in statistical sources and they are not forced to be equal in the Finnish system of accounts.

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Seasonal adjustment

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Seasonal adjustment is a statistical method for removing the seasonal component of a time series that exhibits a seasonal pattern. It is usually done when wanting to analyse the trend of a time series independently of the seasonal components.

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Consumer price index (CPI)

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The consumer price index (CPI) is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care. The CPI is calculated by taking price changes for each item in the predetermined basket of goods and averaging them; the goods are weighted according to their importance. Changes in CPI are used to assess price changes associated with the cost of living.

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(in the US) an index of the variation in prices for retail goods and other items.

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Laspeyers Index

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A Laspeyres index number is a form of index number where prices, quantities or other units of measure over time are weighted according to their values in a specified base period.

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Paashe Index

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French Equivalent: Indice de prix de Paasche. Definition: A price index defined as a fixed weight, or fixed basket, index which uses the basket of goods and services of the current period. The current period serves as the weight reference period and the base period as the price reference period.

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Current population survey

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A statistical survey that is performed by the U.S. Census Bureau of Labor Statistics on a monthly basis. The survey includes a representative sample of about 60,000 homes and focuses on those individuals who are 15 years and older to make an inferential assumption about the U.S. population as a whole.

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Labor force

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The sum of the employed and unemployed.

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Unemployment rate

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Unemployment rate is defined most basically as the percentage of the total labor force that is unemployed but actively seeking employment and willing to work.

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Factors of Production

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Factors of production refer to an economic term to describe the inputs that are used in the production of goods or services in the attempt to make an economic profit.

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Capital

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Capital (economics) Capital has a number of related meanings in economics, finance and accounting. In finance and accounting, capital generally refers to financial wealth, especially that used to start or maintain a business.

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Labor

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All human exertion in the production of wealth and services. Mental toil is labor as well as muscular effort. All who participate in production by their mental and physical effort are laborers in the economic sense. Thus entrepreneurs as well as blue-collar workers are included.

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Production Function

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Production function, in economics, equation that expresses the relationship between the quantities of productive factors (such as labour and capital) used and the amount of product obtained. It states the amount of product that can be obtained from every combination of factors, assuming that the most efficient available methods of production are used.

Y=F (K,L)

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Constant return to scale

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Production process with neither economies nor dis economies of scale: the output of the process increases or decreases simultaneously and in step with increase or decrease in the inputs. A plant with a constant returns to scale is equally efficient in producing small batches as it is in producing large batches. See also declining returns to scale and economies of scale.Read more: http://www.businessdictionary.com/definition/constant-returns-to-scale.html#ixzz45nxBGLNq

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Neoclassical theory of distribution

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"It is the purpose of this work to show that the distribution of income to society is controlled by a natural law, and that this law, if it worked without friction, would give to every agent of production the amount of wealth which that agent creates." (John Bates Clark, Distribution of Wealth, 1899: p.v)

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Factor Price

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In economic theory, the price of a finished item affects the factors of production, the various costs and incentives of producing it, so as to 'attract' it toward a theoretical Factor price. Simply put, factor price is why the price of an item tends to approach the cost of producing it.

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Competitive Firm

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It is small relative to the markets in which it trades, so it has little influence on market prices.

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The marginal product of labor

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marginal product of labor DefinitionMeasure of the physical increase in the output of a firm or economy; it is the output that results from hiring one additional worker, all other factors remaining constant.

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Diminishing Marginal Product

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The law of diminishing marginal productivity is an economic principle that states that while increasing one input and keeping other inputs at the same level may initially increase output, further increases in that input will have a limited effect, and eventually no effect or a negative effect, on output.

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Cobb-Douglas Production function

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In economics, the Cobb–Douglas production function is a particular functional form of the production function, widely used to represent the technological relationship between the amounts of two or more inputs, particularly physical capital and labor, and the amount of output that can be produced by those inputs.