Macroeconomics section 3.2 & 3.3 (Definitions)

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  • Created by: Amalie
  • Created on: 16-03-13 21:06
Economic growth
the growth of real output in an economy over time. Usually measured as growth in real GDP.
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Economic Development
a broad concept involving improvement in standards of living, reduction in poverty, improved health and education. (also increased freedom and economic choice)
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Human Development Index (HDI)
composite index that brings together measurements of health, education, and living standards in order to attempt to measure relative development. Elements are life expectancy at birth, literacy rate, school enrollment rate and GDP per capita[PPP US$]
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Aggregate demand
the total spending in an economy consisting of consumption, investment, government expenditure and net exports.
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Consumption
spending by households on consumer goods and services over a period of time.
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Investment
the addition of capital stock to the economy or expenditure by firms on capital.
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Inflationary gap
the situation where total spending (aggregate demand) is greater than the full employment level of output, thus causing inflation.
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Deflationary gap
the situation where total spending (aggregate demand) is less than the full employment level of output, thus causing unemployment.
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Business cycle/ Trade cycle
shows fluctuations in the level of economic activity in an economy over time and suggests that the changes are cyclical. There are four stages: depression (slump), recovery, boom and recession.
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Other cards in this set

Card 2

Front

a broad concept involving improvement in standards of living, reduction in poverty, improved health and education. (also increased freedom and economic choice)

Back

Economic Development

Card 3

Front

composite index that brings together measurements of health, education, and living standards in order to attempt to measure relative development. Elements are life expectancy at birth, literacy rate, school enrollment rate and GDP per capita[PPP US$]

Back

Preview of the back of card 3

Card 4

Front

the total spending in an economy consisting of consumption, investment, government expenditure and net exports.

Back

Preview of the back of card 4

Card 5

Front

spending by households on consumer goods and services over a period of time.

Back

Preview of the back of card 5
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