Definitions Economics

Inflation =

• A sustained change in the general price level

• A rise in prices

• Prices rising at a positive rate

• A sustained rise in the general price level

Economic Growth =

• A rise in real GDP

• A rise in nominal GDP

• Two quarters of successive growth

• A faster rate of GDP growth

The basic economic problem

• We have limited resources and too many wants

• We have limited land and an expanding labour force (population)

• We have infinite wants and the life is unsustainable

• We have infinite wants but finite resources

GDP

• The value of all goods and service produced within an economy in a set period of time (year)

• The amount of all goods and services produced within an economy in a set period of time (year)

• The total output of an economy over the business cycle

• Total value of all goods and service produced, divided by the population

When price rises due to excess amount of consumers wishing to consume

• Cost push inflation

• Demand pull inflation

• Money supply inflation

• Disinflation

Unemployment

• People who do not have a job and legally can work

• People who are out of work due to losing their job one day

• People who are seeking work, able to start work but can not find work

• People who do not have a job or pay income tax

ILO's definition of unemployment

• People without a job but are ready to start one with 14 days, been actively seeking a job in the last 4 weeks or waiting to start a job they obtained.

• People without a job but are ready to start one with 10 days, been actively seeking a job in the last 3 weeks or waiting to start a job they obtained.

• People without a job but are ready to start one with 28 days, been actively seeking a job in the last 8 weeks or waiting to start a job they obtained.

• People without a job but are ready to start one today, been actively seeking a job in the last 2 weeks or waiting to start a job they obtained.

PPP

• Compares different countries' currencies through a "basket of goods" approach to compare economic productivity and standards/cost of living between countries.

• Compares different countries' currencies through a "basket of goods" approach to measure inflation across countries

• Compares living standards by looking at healthcare, education and GNI per capita

• Shows the different efficient output combination of resources in an economy.

Opportunity cost (text book)

• The good you don't consume

• The next best option forgone

• The alternative that you don't have

• What you give up due to scarcity

Positive statement

• one that cannot be tested or verified and is based on a value judgment.

• A fact of nature

• one that can be tested and verified and is not based on a value judgment

• A evidence based opinion