Post 21: Vocab Terms List

Pg 235:

·         National income accounting – refers to the bookkeeping system that a national government uses to measure the level of the country's economic activity in a given time period.

·         Gross domestic product - The monetary value of all the finished goods and services produced within a country's borders in a specific time period, though GDP is usually calculated on an annual basis.

·         Output expenditure model - total output responds to the demand for it.

·         Personal consumption expenditure - payments by households for goods and services.

·         Gross Investment - Gross private domestic investment is the measure of investment used to compute GDP. This is an important component of GDP because it provides an indicator of the future productive capacity of the economy.

·         Nominal GDP - GDP as actually measured, thus in current dollars. Contrasts with real GDP.

·         Real GDP - Real gross domestic product (GDP) is a macroeconomic measure of the size of an economy adjusted for price changes.

·         Price Index - an index that traces the relative changes in the price of an individual good (or a market basket of goods) over time.

·         Underground economy - An expression used to describe all market exchange that goes unreported either because it is illegal or because those involved want to evade taxes.

·         Gross national product - former measure of the United States economy; the total market value of goods and services produced by all citizens and capital during a given period (usually 1 yr)

Pg 240:

·         Business cycle - The pattern followed by macroeconomic variables, such as GDP and unemployment that rise and fall irregularly over time, relative to trend. There is some tendency for cyclical movements of large countries to cause similar movements in other countries with whom they trade.

·         Expansion – a period of economic growth.

·         Peak – a high point.

·         Contraction – a recession.

·         Recession – is a decline in real GDP for months or more.

·         Depressions – are prolonged and severe recessions.

·         Trough – occurs when demand, production, and employment reach their lowest levels.

·         Leading indicators – anticipate the direction in which the economy is headed

·         Coincident indicators – change as the economy moves from one [phase of the business cycle to another.

·         Lagging indicators – change months after an upturn or a downturn in the economy has begun and help economists predict the duration of economic upturns and downturns.

Pg246:

·         Real GDP per capita – related to all economic indicators that are calculated, usuallyat the end of a fiscal year.

·         Labor Productivity- Work force productivity is the amount of goods and services that a laborer produces in a given amount of time.

·         Productivity growth – a measure of output from a production process, per unit of input

·         Capital-to-labor ratio – for example, labor production is typically measured as a ratio of output.

·         Capital deepening – a term used in economics to describe an economy where capital per worker is increasing. This is also referred to as increase in the capital intensity.

 

Post 20: test corrections

Reviewing facts

Q1: B; H, National income accounting tracks assumption, income, and production in a nation’s economy. (pg. 229)

Q2: (blank); A, nominal GDP is current GDP (pg. 232).

Q4: A; B, Real GDP is used as the primary measure of the U.S. economy until1991 (pg. 232).

Q5: (blank); I, the business cycle explains changes in economic activity that occur in a market system, measured in terms of increases and decreases in the GDP.(pg. 236).

Q7: F; G, coincident indicators are economic variables that occur along with changes in the economy. (pg. 240)

Q8: G; F, lagging indicators are economic variables that occur months after changes in the economy. (pg. 240)

Identifying ideas

Q2: business cycle; product market, four sectors of the product market combine to make up GDP. (pg. 230)

Q5: (blank); gross, because it does not include depreciation, gross domestic product is a more representative measure of a nation’s actual output of new goods than GDP.

Q9: (blank);tax base, an expanded tax base is a benefit of economic growth that gives government more money to spend on such things as education. (pg242)

Understanding ideas

Q4: B; A, GDP figures are sometimes inaccurate because gathering data is a slow process. (pg233)

Q7: B; A, personal income is an example of a coincident indicator. (my blog)

Matching

Q1: B; D, the process of tracking production, income, and consumption in a nations economy is national income accounting. (pg229)

Q2: (blank); B, GDP expressed in the current prices of the period being measured is nominal GDP. (pg232)

Q4: G; F, the total dollar value of all final output produced with factors of production owned by residents of a given country during one year. (pg231)

Q12: N; S, an increase in the amount of capital goods available per worker is capital deepening. (pg245)

Open ended

GDP	=	Consumption
	+	Investment
	+	Government Purchases
	+	Net Exports

Consumption is the largest component of the GDP. In the U.S., the largest and most stable component of consumption is services. Consumption is calculated by adding durable and non-durable goods and services expenditures. It is unaffected by the estimated value of imported goods.
Investment includes investment in fixed assets and increases in inventory.
Government purchases are equal to the government expenditures less government transfer payments (welfare, unemployment payouts, etc.)
Net exports are exports minus imports. Imports are subtracted since GDP is defined as the output of the domestic economy.

Post 25: Who would like inflation?

College students love inflation.
Lets say a college student takes out a loan from a bank that has a contract to be paid back within the next 30 years. if the loan is for $50,000, 30 years later $50,000 dollars isn't worth as much as it would have been when the loan was taken out. This is caused by inflation. College loans are made easier to pay off for young adults because of inflation. Yay inflation.

Post 24: the 4 types of unemployment

4 different ways i could become unemployed in the near future.......hopefully not.

I have become a food sorter for a zoo in California, The zoo has recently attained a sorting machine that can read the labels on the food bags and slide it to its correct pile. The zoo no longer needs me I am now structurally unemployed.

I work in the Reptile exercise yard at the Philadelphia Zoo. I am enjoying every second of it. unfortunately once the outside temperature goes below 70 degrees none of the reptiles can handle being outside. I am now seasonally unemployed.

I was working in a small hometown petting zoo with some small exotics and large common species of animals. Through my program at college I was offered an internship as a animal trainer, and caretaker at a major zoo in Florida. I had to prove that I had not had a job and had been focusing on my studies for at least a month. So, from the time I quit my job at the petting zoo to the time I was accepted to work at the zoo in Florida i was fictionally unemployed.

I am currently employed by an animal rescue down at the BP oil spill. They hired thousands of workers to help the cause. Now that the animals are all cleaned up and they only need a few workers to finish the job, they have released the excess help. I am now cyclically unemployed.

Post 23: Wanted Dead or Alive

Post 22: Quizzes

Frictional unemployment - unemployment attributed to workers moving from one job to another

Discouraged workers - people who want jobs but have stopped looking for work for job-related reasons

Marginally attached workers - people who once held productive jobs but have given up looking for work

Census Bureau - conducts a monthly study called the Current Population Survey

Not in the labor force - anyone who is not classified as either employed or unemployed

Aggregate supply - is the total amount of goods and services produced throughout the economy

A Supply shock - is an event that increases the cost of production for all or many firms.

To construct the consumer price index, the Bureau of Labor Statistics selects a sample of commonly purchased consumer items, called the Market basket

As the value of the dollar decreases, the purchasing power of people who rely on fixed income will fall.

High interest rates lead to less consumer spending.

The income gap between the richest and the poorest Americans was wider in the 1990s than at any other time since World War II.

In 2000 the poverty threshold for a family of four was $17,761.

The poverty threshold is the lowest amount of income a family needs to survive on the bare minimum.

The poverty rate is the percentage of individuals or families that are living in poverty.

To measure the amount of inequality in the distribution of income, economists plot a Lorenz Curve.

One suggestion for improving income equality is raising the minimum wage.

Twitter Post

Link 1

I like this website because it is organized well. It explains each vocabulary term used in the text and is very easy to navigate. The website uses pictures to keep your attention and is a low level reading so its not very hard understand the information.

Link 2

This website is like an economic dictionary! 1 huge glossary of terms. Even within all of the definitions are links to more definiitons. Vocabulary is some of the hardestthings to rememeber sometimes so this website would be very helpful to me.

Link 3

Books books books. This website uses children's to explain economics. An interesting way to illustrate the art of economics.Thereare also links to games that help jog your memory for the simple information.