Economic Growth
An increase in real GDP over time, showing a rise in the output of goods and services
Real GDP
The total value of goods and services produced in an economy adjusted for inflation
Nominal GDP
The total value of goods and services produced in an economy unadjusted for inflation
Inflation
A sustained rise in the general price level over time
Deflation
A sustained fall in the general price level (inflation rate is negative %)
Disinflation
A fall in the rate of inflation (prices still rising, but more slowly)
Consumer Price Index (CPI)
A measure of inflation based on the average change in prices of a representative basket of goods and services
Unemployment
The number of people willing and able to work who are actively seeking work but cannot find a job
Labour Force
The total number of people who are employed or actively seeking employment
Claimant Count
A measure of unemployment based on the number of people claiming Jobseeker’s Allowance or Universal Credit
Employment Rate
The percentage of the working-age population currently in employment
Productivity
Output per unit of input (e.g. output per worker or per hour worked)
economic downturn
a period of slower growth, often a precursor to a recession
characteristics of an economic downturn
- characterised by falling real GDP
- lower confidence (fall in AD and investment)
- rising unemployment (demand-deficient)
- negative output gap
- higher state spending on welfare
policies used to get out of economic downturn
Monetary policy
- Lower interest rates to stimulate borrowing and spending
- Quantitative easing to boost liquidity
Fiscal policy
- Increased government spending
- Tax cuts to boost disposable income
Supply-side policy (longer term)
- Training and education
- Infrastructure investment
- Labour market reforms
Stagnation
Very low or zero economic growth
Recession
Two consecutive quarters of negative growth
Loanable funds
Refers to the money available for lending and borrowing. Comes from eg household savings, business profits, gov surplus and foreign investment.
Explains how the interaction of supply (savers) and demand ( borrowers) in financial markets determine IR
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macro indicators63
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macro term 167
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consumption + AD57
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balance of payments+unemployment98
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macro policies140
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real life application22
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definitions18
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chain Of Reasonings6
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Trade and exchange rates68
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Keynesianism22
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protectionism/globalisation57
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development54
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financial markets129
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real life examples3
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calculations1
