ECONOMICS vocab

stagflation

combination of stagnant economic growth and inflation

hyperinflation

abnormal inflation in excess of 500 percent per year; last stage of monetary collapse

GDP gap

difference between what the economy can and does produce; annual opportunity cost of unemployed resources

consumer price index (CPI)

index used to measure price changes for a market basket of frequently used consumer items

civilian labor force

noninstitutionalized part of the population, aged sixteen and over, either working or looking for a job

debtors

persons or institutions that owe money

creditors

persons or institutions to whom money is owed

unemployment rate

ratio of unemployed individuals divided by total number of persons in the civilian labor force, expressed as a percentage

creeping inflation

relatively low rate of inflation, usually 1 to 3 percent annually

market basket

representative collection of goods and services used to compile a price index

unemployed

state of working for less than one hour per week for pay or profit in a non-family-owned business, while being available and having made an effort to find a job during the past month

price index

statistical series used to measure changes in the price level over time

frictional unemployment

unemployment caused by workers changing jobs or waiting to go to new ones

cyclical unemployment

unemployment directly related to swings in the business cycle

demand-pull inflation

explanation that prices rise because all sectors of the economy try to buy more goods and services than the economy can produce

cost-push inflation

explanation that rising input costs, especially energy and organized labor, drive up the cost of products for manufacturers and thus cause inflation

outsourcing

hiring outside firms to perform non-core operations to lower operating costs

implicit GDP price deflator

index used to measure price changes in gross domestic product

producer price index (PPI)

index used to measure prices received by domestic producers; formerly called the wholesale price index

deflation

sustained decrease in the general level of the prices of goods and services

inflation

sustained rise in the general level of prices of goods and services

structural unemployment

unemployment caused by a fundamental change in the economy that reduces the demand for some workers

seasonal unemployment

unemployment caused by annual changes in the weather or other conditions that prevail at certain times of the year

technological unemployment

unemployment caused by technological developments or automation that make some workers' skills obsolete

misery index

unofficial statistic that is the sum of monthly inflation and the unemployment rate

long-term unemployed

workers who have been unemployed for twenty-seven weeks or more

base year

year serving as point of comparison for other years in a price index or other statistical measure