| A | B |
|---|
| gross domestic product (GDP) | The total value of the goods and services produced in a country in a given year. |
| standard of living | The level of material comfort as measured by the goods and services that are available. |
| inflation | A general increase in the price of goods and services. |
| deflation | A general decrease in the price of goods and services. |
| possible causes of inflation | "It can occur after a war because scarce resources were transferred to the war effort. It can also be caused by an increase in the costs of raw materials, expenses, and salaries. Thirdly, it can also be caused when the government allows too much money to circulate in the economy. |
| economic indicators | Figures that are used to measure economic performance. |
| Possible cause of deflation | This can be caused when an economy produces more goods than people want and sellers have to lower prices and cut production. |
| budget deficit | When the government spends more money on programs than it collects in taxes during a one year period. |
| national debt | The total amount of money a government owes. |
| budget surplus | When a government revenue exceeds its expenditures during a one year period. |
| What governments often do with a surplus: | cut taxes, reduce the national debt, or increase spending for certain programs. |
| unemployment rate | Measures the number of people who are able and willing to work but cannot find work during a given period. |
