ECON test
Inflation
A general and progressive increase in prices
Depression
A long-term economic state characterized by unemployment and low prices and low levels of trade and investment
expansion
A period of economic growth as measured by a rise in real GDP
seasonal employment
A short-term job associated with a certain time of year.
Deflation
A situation in which prices are declining
Recession
A slowdown in a nation's economy
Hyperinflation
A very rapid rise in the price level; an extremely high rate of inflation.
Producer Price Index (PPI)
An index that measures prices at the wholesale level.
business cycle
Fluctuations in economic activity, such as employment and production
Real GDP
GDP adjusted for inflation
Trough
Lowest point of a wave
wage-price spiral
Rising wages cause higher prices and higher prices cause higher wages
cost-push inflation
When prices rise due to an increase in the cost of production.
underground economy
a market where the buyers and sellers make transactions in violation of one or more government regulations. Black market
Consumer Price Index (CPI)
a measure of the overall cost of the goods and services bought by a typical consumer
contraction
a period of economic decline marked by falling real GDP
demand-pull inflation
inflation that is caused by an increase in aggregate demand
Non-market activities
productive activities that take place outside the GDP. volunteer work, babysitting
Real GDP per capita
real GDP divided by the total population
Cyclical Employment
result of changes in the economic and business cycles
peak
the height of an economic expansion, when real GDP stops rising
full employment
the level of employment reached when there is no cyclical unemployment
unemployment rate
the percentage of the labor force that is unemployed
Nominal GDP
the production of goods and services valued at current prices
poverty
the state of being poor
Frictional Employment
unemployment due to the time workers spend in job search
structural employment
unemployment that occurs when workers' skills do not match the jobs that are available