UTK: Economics 201 - Chapter 5

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volfan13
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35086
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UTK: Economics 201 - Chapter 5
Updated:
2010-09-16 00:52:50
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Economics University Tennessee Econ
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Chapter 5 Key Terms
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  1. Definition: The structure of economic activity in a community, a region, a country, a group of countries, or the world.
    Economy
  2. Definition: The market value of all final goods and services produced in the nation during a particular period, usually a year.
    Gross Domestic Product (GDP)
  3. Definition: The market value of all final goods and services produced in the world during a given period, usually a year.
    Gross World Product
  4. Definition: A variable that measures something over an interval of time, such as your income per week.
    Flow Variable
  5. Definition: A variable that measures something at a particular point in time, such as the amount of money you have with you right now.
    Stock Variable
  6. Definition: The incorrect theory that a nation's economic objective should be to accumulate precious metals in the public treasury; this theory prompted trade barriers to cut imports.but other countries retaliated, reducing trade and the gains from specialization.
    Mercantilism
  7. Definition: The rise and fall of economic activity relative to the long-term growth trend of the economy; also called business cycles.
    Economic Fluctuations
  8. Definition: A period during which the economy's output increases.
    Expansion
  9. Definition: A period during which the economy's output declines.
    Contraction
  10. Definition: A sharp reduction in an economy's total output accompanied by high unemployment lasting more than a year.
    Depression
  11. Definition: A sustained decline in the economy's total output lasting at least two consecutive quarters, or six months; an economic contraction.
    Recession
  12. Definition: An increase in the economy's average price level.
    Inflation
  13. Definition: Variables that predict, or lead to, a recession or recovery; examples include consumer confidence, stock market prices, business investment, and big ticket purchases, such as automobiles and homes.
    Leading Economic Indicators
  14. Definition: Variables that reflect peaks and troughs in economic activity as they occur; examples include employment, personal income, and industrial production.
    Coincident Economic Indicators
  15. Definition: Variables that follow,or trail, changes in overall economic activity; examples include the interest rate and the average duration of unemployment.
    Lagging Economic Indicators
  16. Definition: A composite measure of all final goods and services produced in an economy during a given period; real GDP.
    Aggregate Output
  17. Definition: The relationship between the economy's price level and aggregate output demanded, with other things constant.
    Aggregate Demand
  18. Definition: A composite measure reflecting the prices of all goods and services in the economy relative to prices in a base year.
    Price Level
  19. Definition: The economy's aggregate output measured in dollars of constant purchasing power.
    Real Gross Domestic Product (Real GDP)
  20. Definition: A curve representing the relationship between the economy's price level and real GDP demanded per period, with other things constant.
    Aggregate Demand Curve
  21. Definition: A curve representing the relationship between the economy's price level and real GDP supplied per period, with other things constant.
    Aggregate Supply Curve
  22. Definition: A flow variable measuring the amount by which federal government outlays exceed federal government revenues in a particular period, usually a year.
    Federal Budget Deficit
  23. Definition: Macroeconomic policy that focuses on shifting the aggregate demand curve as a way of promoting full employment and price stability.
    Demand-Side Economics
  24. Definition: A contraction, or stagnation, of a nation's output accompanied by inflation in the price level.
    Stagflation
  25. Definition: Macroeconomic policy that focuses on a rightward shift of the aggregate supply curve through tax cuts or other changes to increase production incentives.
    Supply-Side Economics
  26. Definition: A stock variable that measures the net accumulation of annual federal deficits.
    Federal Debt
  27. Definition: Real GDP divided by the population; the best measure of an economy's standard of living.
    Real GDP per Capita

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