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20 Cards in this Set

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What are the goals of Macroeconomics?
To create price stability (low and stable inflation rate) high emplyment, high and sustained economic growth
What are some of the policies associated with Macroeconomics.
Fiscal Policy and Monetary Policy
What is CPI?
Consumer Price Index: A widely cited index number for the price level; the weighted average of prices of a specific set of goods and services purchased by a typical household.
How do u Figure CPI?
CPI of the later year - CPI of the ealier year over CPI of the earlier year...all that X 100
What is Inflation?
An increase in the price level.
What is Real Income?
Nominal Income adjusted for price changes.
What is Nominal Income?
The Current dollar amount of a person's income.
How do you calculate real income?
Nominal income divded by CPI times 100
The labor force is made up of what two groups?
Employed(those already working) and the Unemployed(those who ar not working now but could and would if job was available.)
How do you calculate unemployment rate?
Nuber of unemployed divided by the Civilian labor force all that times 100
what is Frictional Unemployment?
Caused by frictions in the economy such as info problems, worker or labor mobility (unemployment between jobs)
what is structural unemployment?
Caused by structural changes in the economy due to technological changes AkA: Mismatched unemployment
what is cyclical unemployment?
casued by declining demand for goods during recessions.
what is natural unemployment?
frictional unemploy. plus structural unemploy.
what is full employment?
when actual unemployment = natural unemployment
What is GDP?
Gross Domestic Product: the total market value of final goods and services produced domestically over one year.
what does GDP omit?
1.)Intermediate group: things like ink and paper in a book
2.)None market goods
3.)Underground activities
ect...
what is the value added method?
every process the product goes through is taxed and added on...until it gets to the buyer
what is Expenditure method?
GDP=consumption+investment+govt. purchases+net exports
What is income method?
GDP=Domestic Income+ Indirect business taxes +Capitol Consumption allowance(AKA depreciation)