Unit 3: Macroeconomics

The market value of all final goods and services produced in a country in a calendar year.

The number of people in the civilian work force over the age of 16 without jobs who are actively seeking work.

A price index that measures the cost of a fixed basket of consumer goods and services and compares the cost of this basket in one time period with its cost in some base period. Changes in the CPI are used to measure inflation.

A rise in the general or average price level of all the goods and services produced in an economy. Can be caused by pressure from the demand side of the market (demand-pull inflation) or pressure from the supply side of the market (cost-push inflation).

A decline in real GDP combined with a rise in the price level.

A schedule (or graph) that shows the value of output (real GDP) that would be PRODUCED at different price levels.

A schedule (or graph) that shows the value of output (real GDP) that would be DEMANDED at different price levels.

The type of unemployment resulting from people's present abilities, skills, training and location not matching up with available job openings that reflect the basic structure of the economy.

Unemployment caused by fluctuations in the overall rate of economic activity or phase of the business cycle.

Unemployment that is always present in the economy, resulting from temporary transitions made by workers and employers or from workers and employers having inconsistent or incomplete information.

Fluctuations in the overall rate of national economic activity with alternating periods of expansion and contraction; these vary in duration and degrees of severity; usually measured by real gross domestic product (GDP).

The height of an economic expansion, when real GDP stops rising.

A period of economic decline marked by falling real GDP.

The lowest point in an economic contraction, when real GDP stops falling

A period in a business cycle following a