Econ Midterm pt. 2

high level

positive growth (upward trend)

constant level (stable, no inflation- low rate of inflation acceptable)

full employment

result of time involved in adjusting to changing labour force and employment opportunities [in between jobs]

1. rate of growth of real national income

2. rate of inflation

3. rate of employment

number of adults (15 yrs or older) employed (working) full-time, part-time, or self-employed

not working but available for and seeking work (economic, social, psychological problem)

[Sub. set of Pop.] those who are employed and those who are not employed but actively looking for jobs

How long/ when was the last time you looked for a job?

unemployed/labor force

Want to work but no longer look because they believe suitable work is not available

[not considered unemployment because you are not actively looking for jobs]

Demand: P = 10-q

Supply: P = 1 + (1/2)q

Observing GDP as it goes through cycles; captures cyclical nature of GDP expansion

Caused by changes in economic structure relative to labor force characteristics

[mismatch of demand and supply labor pertaining to skills]

Consumption + Investment expenditures + Government expenditures + (Exports - Imports)

[C + I + G (X - IM)]

Real GDP/ Pop.

index of current final output prices relative to base year prices

GDP deflator = (Nominal GDP/Real GDP) x 100

The quantity of final goods and services produced by the economy in a specified period of time

[GDP (year)/ GDP deflator] x 100

Rate of growth of real GDP = [Real GDPyear 2 − Real GDPyear 1]× 100

the market value at current prices of all final goods and services

a measure of the price level in one year compared with prices in a base year

(employment/ population 15+ years) x 100

(labor force- employment/labor force) x 100

(nominal GDP/GDP deflator) x 100