32 Questions
What is the formula to calculate GDP growth?
(Real GDP2022 - Real GDP2021) / Real GDP2021 x 100
What are the main sources of economic growth?
Land, labor, capital, and entrepreneurship
What is a broader concept of measuring economic growth that considers welfare objectives?
Growth of per capita real GDP
What is a business cycle?
Recurring upward and downward movements in economic activity
What is the peak phase of a business cycle?
A temporary local maximum of economic activity
What characterizes a recession?
A decline in real output lasting six months or longer
What type of unemployment occurs when people transition from one job to another?
Frictional unemployment
What is the result of frictional unemployment?
Higher efficiency
Why is frictional unemployment considered inevitable?
Because the labour market does not operate perfectly and instantaneously
What is a possible remedy for frictional unemployment?
Developing efficient systems or databases that provide information on existing opportunities for easy access by job seekers
Which type of unemployment occurs when people are not actively seeking a job?
Discouraged workers
Why does the unemployment rate not reflect the actual rate of unemployment?
Because it does not count discouraged workers
What is demand-pull inflation caused by?
Excess aggregate expenditure beyond the economy's capacity to produce
What is the result of an increase in aggregate spending when the economy is at full employment?
An increase in the price level
What type of inflation is caused by an increase in per unit costs of production?
Cost-push inflation
What happens when aggregate demand increases beyond the economy's capacity to produce?
The price level is pulled upwards
What is another term for demand-pull inflation?
Demand-side inflation
What is the term for those who are willing and able to work, but are not institutionalized and are not employed or seeking work?
Not in Labour Force
What is the formula to calculate the unemployment rate?
Unemployment Rate = Unemployed x100 / Labour Force
What is the term for the proportion of a country's working age population that is working or actively seeking work?
Labour Force Participation Rate (LFPR)
What category includes persons who are not seeking work, either because they do not want jobs or have given up looking for jobs, homemakers, and adult full-time students?
Not in Labour Force
What is the term for all persons 16 years or older who are able to work, including those in the labour force and those not in the labour force?
Working Age Population
What is the term for the number of persons who are willing and able to work, including the employed and unemployed?
Labour Force
What happens to the Labour Force Participation Rate (LFPR) during an economic recession?
It decreases
What is the term for the number of persons who are employed and unemployed?
Labour Force
What is the category for those who are in correctional and mental health institutions?
Institutionalized
What is the term for the proportion of unemployed persons to the total labour force?
Unemployment Rate
What is the relationship between the value of money and the price level?
The value of money decreases when the price level rises
How does inflation affect savers?
Inflation decreases the real value of savings
Who benefits from inflation?
Only debtors
What is the central bank's objective regarding inflation?
To achieve price stability
What is the relationship between inflation and output?
The relationship between inflation and output is debated among economists
Quiz on measuring economic growth using GDP, real GDP, and growth rates, including calculations and interpretations.
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