econ exam 1 terms

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Anonymous
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137578
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econ exam 1 terms
Updated:
2012-02-25 09:50:26
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econ401
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Ch. 1-6 terms
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  1. Real GDP
    total money value of all final goods and services produced domestically during a particular period of time, where this value is calculated using a set of prices in base period
  2. Nominal GDP
    total money value of all final goods and services produced domestically during a particular period of time, where this value is calculated using a set of current prices
  3. Price level
    the cost of a specific basket of goods
  4. Price Index
    the cost of a sample basket of goods and services in one period divided by the cost of the same basket of goods and services in the base year
  5. GDP Deflator
    is measured by dividing nominal GDP by real GDP, GDP deflator is a price index that is used to deflate nominal GDP to real GDP
  6. Inflation
    a sustained increase in price level
  7. Deflation
    a sustained decrease in price level
  8. Final Good
    goods and services that are purchased by their ultimate users
  9. Intermediat good
    any good or service that is used in the production of other goods and services or any good and service that is bought only to be resold
  10. Demand curve
    plots the relationship between price of an item and quantity demanded holding all other factors that influence quantity supplied constant
  11. Supplied curve
    plots the relationship between price of an item and quantity supplied holding all other factors that influence quantity supplied constant
  12. Equilibrium price
    the price at which quantity demanded equals quantity supplied
  13. Equilibrium quantity
    the quantity supplied and quantity demanded associated with equilibrium price
  14. Invisible hand
    refers to the market's self-adjusting processes
  15. Price ceiling
    maximum price above which businesses are prevented from charging
  16. Price floor
    minimum price below which businesses are prevented from charging
  17. Opportunity cost
    of a decision is the value of the next best alternative that must be given up because of that decision
  18. Economics
    a social science devoted to understand how society can efficiently allocate scarce resources

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