Economics Unit 2

Front 1

Circular Flow

Back 1

the continuing and recurrent transfers of money and goods among producers and consumers

Front 2

Gross Domestic Product (GDP)

Back 2

the total value of the goods and services produced by the people of a nation during a year not including the value of income earned in foreign countries

Front 3

Final Goods

Back 3

a good or service that is consumed by the end user and does not require any further processing

Front 4

Intermediate Goods

Back 4

material or item that is a final-product of a process, but is also used as an input in the production process of some other good

Front 5

Durable Goods

Back 5

mass market heavy goods (such as washing machines, refrigerators, furniture) intended to last three or more years

Front 6

Real GDP

Back 6

an economic assessment that involves quantifying the inflation adjusted market value of goods and services produced by an economic system during a given time

Front 7

Nominal GDP

Back 7

the determination of actual gross domestic product without taking into account other factors or variables such as inflation

Front 8

Unemployment Rate

Back 8

percentage of total workforce who are unemployed and are looking for a paid job

Front 9

Discouraged Worker

Back 9

person who available for a job but is not currently looking for one

Front 10

Labor Force

Back 10

number of individuals in an economy who either are employed or are seeking employment

Front 11

Labor Force Participation Rate

Back 11

percentage of total population that either is employed or is seeking employment

Front 12

Natural Rate of Unemployment

Back 12

level of unemployment at which the inflation rate in an economy stays stable and, if the unemployment falls due to an expanding economy, the inflation rate starts to accelerate

Front 13

Frictional Unemployment

Back 13

temporary unemployment arising out of the inevitable time lags in the functioning of labor markets, such as the time taken in moving from one job to another

Front 14

Structural Unemployment

Back 14

joblessness caused not by lack of demand, but by changes in demand patterns or obsolescence of technology, and requiring retraining of workers and large investment in new capital equipment

Front 15

Cyclical Unemployment

Back 15

workers losing their jobs due to business cycle fluctuations in output

Front 16

Inflation

Back 16

a sustained, rapid increase in prices, as measured by some broad index (such as Consumer Price Index) over months or years, and mirrored in the correspondingly decreasing purchasing power of the currency

Front 17

Deflation

Back 17

reduction of the general level of prices in an economy

Front 18

Real Income vs Nominal Income

Back 18

real income is the income expressed in terms of the goods or services it can purchase, where nominal income is the amount of currency earned

Front 19

Real Wages vs Nominal Wages

Back 19

real wages are wages that have been adjusted for inflation, where nominal wages are the currency amount earned for one's labor

Front 20

Real Interest Rates vs Nominal Interest Rates

Back 20

real interest rates are the rates of interest an investor expects to receive after allowing for inflation, where nominal interest rates are the rates of interest that is reported on loan documents and investment accounts that are not adjusted for inflation

Front 21

Consumer Price Index (CPI)

Back 21

measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care

Front 22

Producer Price Index (PPI)

Back 22

family of indexes that measures the average change in selling prices received by domestic producers of goods and services over time

Front 23

GDP Deflator

Back 23

price index that measures inflation or deflation in an economy by calculating a ratio of nominal GDP to real GDP

Front 24

Mr. Gannon

Back 24

greatest teacher of all time (GTAT)