Economics AQA AS Level: Macro Keywords. 100% proven pass rate

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GDP - Ans-Total value of goods and services produced within a country within a year GDP per capita - Ans-Total value of goods and services produced within a country within a year divided by the popu... lation The Economic Cycle - Ans-Fluctuations in economic activity as measured by changes in real GDP Positive Output Gap - Ans-When actual GDP is above potential GDP Negative Output Gap - Ans-When actual GDP is below potential GDP Inflation - Ans-Sustained rise in average prices as measured by percentage changes in the CPI Macroeconomic Equilibrium - Ans-When the amount of goods and services produced equals the amount demanded at a given price level Aggregate Demand - Ans-Total expenditure on UK goods and services at different price levels in a time period (C+I+G+X-M) Aggregate Supply - Ans-Total quantity of goods and services in the UK willing to be supplied at different price levels in a time period Consumer Spending - Ans-Total expenditure by households on UK and imported goods and services in a time periodInvestment - Ans-Spending by firms on capital goods to increase their productive capacity, improve their efficiency and competiveness Government Spending - Ans-Spending by the government on measures to boost aggregate demand Savings - Ans-The part of disposable income which is not spent Savings Ratio - Ans-Savings divided by disposable income Disposable Income - Ans-Income after direct taxes and National Insurance Contributions have been deducted, but including welfare benefits Rate of Interest - Ans-Reward to saving and the cost of borrowing as a percentage The Multiplier - Ans-An increase in aggregate demand which leads to a further increase in real GDP, leading to more income, output and jobs The Accelerator - Ans-When an increase in real aggregate demand leads to more GDP which leads to a further increase in profits, confidence and the need for firms to expand Productivity - Ans-Real output per worker per time period The Institutional Structure of the Economy - Ans-Legal, banking and political framework of an economy (good = increase in LRAS) Balance of Payments - Ans-A record of a country's financial transactions with the rest of the world Current Account Deficit - Ans-When there are more debits than credits on trade in goods and services, net investment income and net transfers [Show More]

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