Macroeconomics Unit 2 Flashcard

Front

What are the three goals of every economy?

Back

To measure growth, reduce unemployment, and keep prices stable

Front

What is GDP?

Back

The dollar value of all goods and services produced in a country's border in a given year.

Front

Which approach is the most important way to measure GDP? Options: Expenditures approach, Income approach, Value-added approach, All approaches are equally important

Back

Expenditures approach

Front

What is the equation for calculating GDP using the expenditures approach?

Back

C + I + G + Xn

Front

Which of the following is not included in GDP? Intermediate goods, Non-production transactions, Use goods, Illegal transactions

Back

Intermediate goods

Front

What is the circular flow model?

Back

A model that shows the flow of goods and services in an economy

Front

What is the labor force participation rate?

Back

The percentage of the total population that is in the labor force

Front

Who is considered frictionally unemployed?

Back

People who are between jobs

Front

What is the natural rate of unemployment?

Back

The rate of unemployment when the economy is at full employment

Front

Who is not counted as unemployed?

Back

Part-time workers