OCR AS Economics: F582: Macro: The National and International Economy Part 1

Definition cards from Bamford textbook for the Macroeconomics paper (OCR F582), definitions taken from Chapter 4: Aggregate demand and aggregate supply and their interaction. Part 1 of 3 sets of revision cards covering the whole paper. 

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  • Created by: Josie
  • Created on: 04-02-11 19:05

Aggregate demand

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Aggregate demand

The total demand for a country's goods and services at a given price level and in a given time period

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Price level

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Price level

The average of each of the prices of all the products produced in an economy

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Consumer expenditure

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Consumer expenditure

Spending by households on consumer products

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Investment

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Investment

Spending on capital goods

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Government spending

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Government spending

Spending by the central government and local government on goods and services

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Exports

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Exports

Products sold abroad

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Imports

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Imports

Products bought from abroad

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Net exports

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Net exports

The value of exports minus the value of imports

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Transfer payments

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Transfer payments

Money transferred from one person or group to another not in return for any good or service

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Job seeker's allowance

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Job seeker's allowance

A benefit paid by the government to those unemployed and trying to find a job

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Trade surplus

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Trade surplus

The value of exports exceeding the value of imports

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Trade deficit

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Trade deficit

The value of imports exceeding the value of exports

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Consumer condidence

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Consumer confidence

How optimistic consumers are about future econonomic prospects

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Rate of interest

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Rate of interest

The charge for borrowing money and the amont paid for lending money

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Average prospensity to consume (APC)

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Average prospensity to consume (APC)

The proportion of disposable income spent. It is consumer expenditure divided by disposable income

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Net savers

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Net savers

People who save more than they borrow

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Wealth

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Wealth

A stock of assets, e.g. property, shares and money held in a savings account

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Distribution of income

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Distribution of income

How income is shared out between households in a country

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Inflation

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Inflation

A sustained rise in the price level

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Saving

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Saving

Real disposable income minus spending

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Average prospensity to save (APS)

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Average prospensity to save (APS)

The proportion of disposable income saved. It is saving divided by disposable income.

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Target savers

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Target savers

People who save with a target figure in mind

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Dissave

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Dissave

Spending more than disposable income

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Savings ratio

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Savings ratio

Savings as a proportion of disposable income

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Capacity utilisation

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Capacity utilisation

The extent to which firms are using their capital goods

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Corporation tax

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Corporation tax

A tax on firms profits

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Retained profits

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Retained profits

Profit kept by firms to finance investment

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Unit cost

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Unit cost

Average cost per unit of output

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Real GDP

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Real GDP

The country's output measured in constant prices and so adjusted for inflation

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Gross domestic product (GDP)

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Gross domestic product (GDP)

The total output of goods and services produced in a country

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Exchange rate

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Exchange rate

The price of one currency in terms of another

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Tariff

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Tariff

A tax on imports

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Government bond

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Government bond

A financial asset issued by the central or local government as a means of borrowing money

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Aggregate supply

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Aggregate supply

The total amount that produces in an economy are willing and able to supply at a given price level in a given time period

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Productivity

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Productivity

Output, or production, of a good or service per worker per unit of a factor of production in a given time period

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Privatisation

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Transfer of assets from the public to the private sector

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Macroeconomic equilibrium

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Macroeconomic equilibrium

A situation where aggregate demand equals aggregate supply and real GDP is not changing

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Circular flow of income

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Circular flow of income

The movement of spending and income throughout the economy

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Factor services

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Factor services

The services provided by the factors of production

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Leakages

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Leakages

Withdrawals of possible spending from the circular flow of income

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Injections

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Injections

Additions of extra spending into the circular flow of income

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Multiplier effect

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Multiplier effect

The process by which any change in a component of aggregate demand results in a greater final change in real GDP

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Overheating

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Overheating

The growth in aggregate demand outstripping the growth in aggregate supply, resulting in inflation

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Output gap

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Output gap

The difference between an economy's actual and potential real GDP

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Trend growth

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Trend growth

The expected increase in potential output over time

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Comments

Kunal Sarin

Report

Brilliant, cheers!

KanKan

Report

Great work!

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