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Macroeconomics
| Term | Definition |
|---|---|
| GDP | measures the monetary value of final goods and services—that is, those that are bought by the final user—produced in a country in a given period of time |
| Real GDP | an inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a given year |
| Net GDP | an annual measure of the economic output of a nation that is adjusted to account for depreciation. It is calculated by subtracting depreciation from the gross domestic product |
| Inflation | happens when prices go up and therefore the purchasing power of money goes down. A dollar is worth fundamentally less if, overall, goods and services increase in price. |
| Shrinkflation | occurs when companies keep their prices the same, but give you less of their products |
| Consumer Price Index | measures the change in prices paid by U.S. consumers for everyday goods and services, like groceries, gas and rent. It is the instrument to measure inflation. |
| Comparative Advantage | an economy's ability to produce a particular good or service at a lower opportunity cost than its trading partners. |
| Unemployment | a situation where a person actively searches for employment but is unable to find work. Considered to be a key measure of the health of the economy. |
| Business Cycle | describe the increase and decrease in economic activity over time. |
| Recession | a significant, widespread, and prolonged downturn in economic activity. |
| Depression | a dramatic and sustained downturn in economic activity, with symptoms including a sharp fall in economic growth, employment, and production |
| Circular Flow | a dramatic and sustained downturn in economic activity, with symptoms including a sharp fall in economic growth, employment, and production |
| Traditional Economy | is a system in which the development and distribution of goods and services are determined by customs, traditions, and time-honored beliefs. |
| Market Economy | a system in which supply and demand dictate how products and services are produced. |
| Command Economy | the government of a country decides production, prices, investments, process, and quantity of goods. |
| Mixed Economy | a combination of a market and a command economy. Some industries are owned and controlled by the government, while other industries are allowed to be determined by the market. |
| Fiscal Policy | the use of government spending and taxation to influence the economy. |
| Monetary Policy | a set of tools used by a nation's central bank to control the overall money supply and promote economic growth and employ strategies such as revising interest rates and changing bank reserve requirements. |
| Labor Unions | an organization formed by workers in a particular trade, industry, or company for the purpose of improving pay, benefits, and working conditions. |
| Nonprofits | a business that has been granted tax-exempt status by the Internal Revenue Service (IRS) because it furthers a social cause and provides a public benefit. |
| Cooperatives | businesses owned and con- trolled by the people who use them. They are member owned and operate for the benefit of members, rather than earn profits for investors. |
| Stock Market | a place where shares of pubic listed companies are traded |
| Monopoly | A market structure characterized by a single seller, selling a unique product in the market. |
| Antitrust laws | regulate the concentration of economic power to prevent companies from price colluding or creating monopolies. |
| Automatic Stabilizer | offset fluctuations in economic activity without direct intervention by policymakers. |
| Embargo | a ban on importing, exporting or doing other commercial activities with a specific country. |
| Sanction | the withdrawal or suspension of the usual trade and financial relations with a country, a company, a group, or an individual. |
| Tariff | taxes imposed by one country on goods or services imported from another country. |
| Quota | a limit placed on the amount or value of a good that a country imports or exports for a given period. |
| Subsidy | money provided by government to firms in the form of cash, grants or tax breaks as an incentive to help reduce production costs which can then be passed on to customers as lower prices, and this can encourage consumption. |
| Protectionism | the policy of protecting domestic industries against foreign competition through tariffs, import quotas and subsidies, or other restrictions placed on the imports of foreign competitors. |
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tamaralamb
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