| A | B |
|---|
| product | item produced in an economy |
| GDP | the total market value of all final goods and services produced in a country in 1 year |
| output | the amount produced |
| GDP per capita | the total amount of goods and services produced in a year divided by the population; can be used to show growth in a country or to compare 2 different countries |
| standard of living | quality of life measured by how well people are able to meet their wants and needs |
| economic growth | an increase in the output of goods and services over time |
| productivity | a measure of how efficiently resources are used to create products |
| specialization | when businesses and people focus their work on one product or services |
| division of labor | breaking down a large job into smaller taskes each of which is done by a different workers |
| consumption | is purchases of goods and services by households. It makes up more than two-thirds of GDP in the United States. |
| investment | is purchases of fixed assets by businesses, and inventories |
| voluntary exchange | when buyers and sellers have a transaction |
| profit | the money left over from the sale of goods or services after all costs have been paid |
| trade defecit | If a country imports more than it exports |
| trade surplus | if a country exports more than they import |
| laissez faire economics | belif that the govt should play only a small role in economy |
| business cycle | alternating periods of economic growth and decline |
| recession | a time of declining economic activity lasting six months or longer |
| depression | GDP and general economic hardship |
| unemployment rate | percentage of people in the civilian labor force who are not working but are looking for jobs |
| fixed income | income that does not rise evn though prices are going up |
| inflation | long term increase in the generla level of prices |
| recession | during a time of contraction what term do refers to when the GDP falls at least 6 straight months |
| contraction | part of the business cycle that is a period of economic decline |
| expansion | part of the business cycle that is a period of economic growth |
| trough | part of the business cycle that is the lowest point of an economic decline |
| non durables | Goods that only last a short amount of time like food or clothing |
| durables | goods that last for a relatively long time like appliances and carsgoods that last for a relatively long time like appliances and cars |
| depreciation | This is the loss of value of equipment or goods that is a result from normal wear & tear. |
| net exports | exports minus imports |
| the result of imports exceding exports, US has this | negative net export |
| the result of exports exceeding imports | positive net exports |
| real Gdp | the measure of GDP adjusted for price increase (inflation) |
| nominal GDP | the measure of GDP in current dollars—everything added up in the currency value of that year. |
| the difference between rea and nominal GDP | inflation |
| Consumer Price Index (CPI) | a govt. database of 400 products, to track inflation. |
| deflaion | general decrease in prices and the increase in the purchasing power of money |
| WWII | a time of economic expansion that helped bring the US out of the Great Depression |
| per capita | per person |
| economic growth | is being able to make more things. |
| economic development | is a better quality of life. |
| productivity | refers to the value of output (goods and services) produced per unit of input (productive resources). |
| boom | peak or the highest pt. of an economic cycle |
| peak | boom or the highest pt. of an economic cycle |
| Great Depression | worst economic contraction in US history |
