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13 Cards in this Set
- Front
- Back
1.What is the difference between Real GDP and Nominal GDP?
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P114
Real- measures the value of final goods and services produced within the borders of a given country during a given period of time, typically a year. (adjusted for inflation) (Nominal minus inflation) Nominal- totals the dollar value of all goods and services produced within the borders of a given country using their prices during the year that they were produced. (todays dollars) |
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2.Identify some of the economic consequences of unemployment?
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-must count as a loss all the goods and services that unemployed workers could have produced if they had been working.
-major social problems like higher crime rate and greater political unrest as well as higher rates of depression, heart disease, and other illnesses amoung unemployed. |
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3.What is “inflation”? How can it affect the economy?
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P114
-is an increase in the overall level of prices. |
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4.What do economists mean when they use the term “modern economic growth”?
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P115
output begins to grow faster than the population and living standards began to rise as the amount of out put per person increased. - output per person rises as compared with earlier times in which output (but not output per person) increases. |
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5.What does “GDP per Capita” measure? How is it computed?
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GPD divided by per person
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6.What is the difference between “savings” and “investments”?
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P116
savings- are generated when current consumption is less than current output(or when current spending is less than current income) investment-happens when resources are devoted to increasing future output. ( they are going to improve the economy, equipment, plants) |
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7.How do “financial investment” and “economic investment” differ?
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P116
financial investment-stocks and bonds, are only paper, economic investment- creation and expansion of business enterprise. (capital goods) |
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8.What is the principal source of savings? Of economic investors?
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P117 1st column
Households businesses |
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9.What is an “economic shock”?
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P117
-situations in which they were expecting one thing to happen but then something else happened. (something worse happened than what you expected) |
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10.How do demand shocks and supply shocks differ?
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P117
demand- are unexpected changes in the demand for goods and services. (consumers have suddenly changed their minds about.) supply-are unexpected changes in the supply of goods and services |
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11.What is the economic definition of “inventory”?
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P119
-is a store of output that has been produced but not yet sold. |
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12.What is the difference between “flexible prices” and “sticky prices”?
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P119
flexible- direct coorolation to demand prices are inflexible. price go up fast and come down slow. |
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13.(The Last Word) Identify the main points of this article. Which ones do you agree or disagree with?
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P122
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