Ch. 2 Key Terms
Terms
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- budget deficit
- occurs when a government spends more than it takes in
- price index
- a number that compares prices in one year with some earlier base year
- capital projects
- spending by businesses for items sucha s land, buildings, equipment, and new products
- GDP per capita
- the output per person, calculated by dividing gross domestic product (GDP) by total production
- deflation
- a decrease in the general level of prices
- recovery
- the welcome phase int he business cycle in which unemployment begins to decrease, demand for goods and services increases, and gross domestic product (GDP) begins to rise again
- gross domestic product (GDP)
- the total dollar value of all final goods and services produced in a country during one year.
- productivity
- the production output in relation to a unit of input, such as a worker
- prosperity
- the peak of the business cycle, it is a period in which most people who want work are working, businesses produce goods and services in record numbers, wages are good, and the rate of gross domestic product (GDP) growth increases
- budget surplus
- occurs when a government spends less than it takes in
- bond
- a certificate representing a promise to pay a definite amount of money at a stated interest rate on a specified due date
- stock
- ownership in corporation
- unemployment rate
- the portion of people in the labor force who are not working
- personal income
- salaries and wages as well as investment income and government payments to individuals
- business cycle
- a movement of the economy from one condition to another and back again. it has four cycles including prosperity, recession, depression, and recovery
- retail sales
- the sales of durable and nondurable goods bought by consumers
- depression
- the phase of the business cycle that is marked by a prolonged period of high unemployment, weak consumer sales, and business failures
- inflation
- an increase inthe general level of of prices
- national debt
- the total amount owed by the federal government
- recession
- the phase of the business cycle in which demand begins to decrease, businesses lower production, unemployment begins to rise, and gross domestic product (GDP) growth slows for two or more quarters of the calendar year