Unit 7 - Business Cycles and GDP

GDP, or gross domestic product, measures...

• the value of all final goods and services produced

• an increase in the general price level

• the percentage of people looking for work that can't find it

• the economic freedom an economy offers

Inflation measures...

• the value of all final goods and services produced

• an increase in the general price level

• the percentage of people looking for work that can't find it

• the economic freedom an economy offers

Unemployment measures...

• the value of all final goods and services produced

• an increase in the general price level

• the percentage of people looking for work that can't find it

• the economic freedom an economy offers

Which of the following is a peak?

• A

• B

• C

• D

Which of the following is a recession, or contraction?

• A

• B

• C

• D

Which of the following is a trough?

• A

• B

• C

• D

Which of the following is an expansion, or recovery?

• A

• B

• C

• D

Nominal GDP - _____ = Real GDP

• Inflation

• Unemployment

• Imports

• Exports

GDP divided by ______ = GDP per capita

• population

• income

• wealth

• production

"Real" GDP more accurately measures changes in production than Nominal GDP because it accounts for...

• changes in price

• phases of the business cycle

• increases in unemployment

• decreases in exports