Economics: GDP, Inflation, and Unemployment

• GDP: The total value of all final goods and services produced in a country in a single year
• Per Capita GDP: This is used to accurately compare the GDP of countries to one another
• Population growth: How much a country's population grew over a period of time
• Traditional economies: Characterized by hunters who gather and fish
• Developing economies: Characterized by factories
• Developed economies: Characterized by microchips and coding
• Real GDP: Eliminates inflation/deflation to accurately track a country's progress
• Inflation: When prices rise, buying power decreases
• Deflation: When prices lower, buying power increases
• Peak: The top level the Real GDP reaches in a cycle, a result of prosperity
• Expansion: Follows recovery, even if the Real GDP goes up just a little
• Trough: The lowest point; if a recession lasts long enough, a depression results
• Recession: A prolonged contraction, specifically six straight months of decline in the Real GDP

Unemployment Types

• Frictional unemployment: Natural unemployment when someone leaves a job and looks for a new one
• Cyclical unemployment: Occurs when the economy slows, and demand forces companies to lay off workers
• Structural unemployment: Occurs when the whole economy shifts due to tech or inevitable change

Circular Flow

• Business Sector: Goods and services are produced
• Product Market: Income is spent
• Consumer Sector: Goods and services are used
• Factor Market: Income is earned

Trade

• Protectionism involves efforts to protect domestic businesses from foreign competition by limiting imports through quotas and tariffs, and seeking copyright respect from other countries
• Balance of trade: A reflection of imports compared, value-wise, with exports
• Trade surplus: Exporting more than importing
• Trade deficit: Importing more than exporting
• Exchange rate: The value of one country's currency versus another's

Trade Concepts

• Deficits: Occur when if more is imported, or received more from another country
• Surpluses: Occur when more if exported, or sent more to another country
• Tariffs: Taxes on imported goods
• Quotas: Limits on the quantity of goods that can be imported
• Embargos: A total ban on trade with a specific country
• Absolute advantage: When a country can produce a product more efficiently than another due to system or circumstance
• Comparative advantage: When a country can produce something at a better rate than other things
• Specialization: Focus on one product to gain comparative advantage via specialization
• Embargos: Trade restrictions placed on a country by another country/countries as a result of certain actions
• NAFTA: North American Free Trade Agreement facilitates free trade among participants; the United States has received cheaper goods but lost jobs because of the agreement
• The European Union: A group of European countries that allows trade, goods, and services to flow and uses the Euro as currency

Financial Measures

• CPI: The value/price of goods and services consumers have bought over a specified period
• PPI: A measure of inflation from the perspective of producers that measures prices of goods and services produced over a specific period
• The Federal Reserve: Sets interest rates and helps control the power of money to implement monetary policy
• Fear is that inflation, or the increase in prices and the decrease in money's power, will hurt the flow of economic activity

Fiscal Policy

• Fiscal policy: Subsidies are payments to producers, and stimulus checks are payments to consumers, to motivate and enhance the economy
• Fiscal Policy: How we tax and spend government money to control jobs and investment

Business Concepts

• Law of diminishing returns: Profits or benefits gained from something will represent a proportionally smaller gain as more money or energy is invested in it
• Law of diminishing marginal utility: States the same about customer enjoyment reaching a saturation point
• Market Concentration index: More significant weighting on larger firms whose greater market share have a greater impact on the level of competitiveness in the market, considering size relative to total market

Legal Concepts

• Eminent domain: Eminent domain states that everything in America is America's thanks to the 5th amendment and intellectual property is subject to this as is physical land
• Patent/copyright laws/trademarks/licensing, and “fair use”: Allow you to reproduce the work, to prepare derivative works, to distribute copies, and to perform and display the work publicly; the owner owns what they make for life plus 70 years
• The work must be original, independently created, a work of authorship, be a product of creative expression and be fixed, perceived, permanent, tangible
• Article 1, section 8: Allows for copyrights, but also for “fair use” (transformative, educational, amount used, and marketability)

North Carolina Industries

• NC Farming: Sweet Potatoes, tobacco, and christmas trees
• NC Furniture and textiles
• NC and BioTechnology, Pharmaceuticals, and automotive parts
• NC and fishing

This lesson covers key economic indicators such as GDP, inflation, and unemployment. It explains different types of economies and how they are characterized. It defines terms such as recession, expansion and peak.