Economics and business B Theme 2 definitions A-I

1. measures actual output as a percentage of the theoretical output at its maximum level (8, 11)
5. is set by the Bank of England and influences the interest rate accross the country (4, 4)
6. measured using the CPI consumer price index, the headline rate and the baisis for the governments inflation target, or the RPI the retail price index, which includes housing costs eg council tax and mortgage interest payment (9)
7. the stage of the ecomomic cycle when the boom slows and the rate of growth or GDP decreases (8)

2. the ammount of income that can be spent on goods and services. spending power after tax (10, 6)
3. organising production so that production is maximised, waste is minimised and costs are lowest possible (10)
4. this occurs when the exchange rate rises, making imports cheaper and raising the price of exports (12)
8. includes all assets that can potentially generate income ie land, premises, machinery and financial assets (7)
9. spending now on capital assets that will generate income in the future (10)
10. value each year's output at the price levels of a base year, removing the effects if inflation (8, 6)

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