Flashcards: Fundamentals of Macroeconomic Policy — 18 cards

Market — definition?

A place for exchange between buyers and sellers.

Offer — role?

Quantity sellers are willing to sell at a price.

Demand — role?

Quantity buyers are willing to buy at a price.

Market price — function?

Value of goods expressed in money.

Market for labor — purpose?

Exchange of labor for remuneration.

Economic circuit — representation?

Interaction of households, firms, government, and abroad.

Institutional sectors — groups?

Economic units sharing similar behavior.

Economic flows — examples?

Goods, services, or capital movements.

Resources-uses equilibrium — condition?

Resources = Uses, full employment of resources.

National accounts — purpose?

Record economic activity for macro aggregates.

GDP — calculation basis?

Declared economic activities to the state.

GDP exclusions — examples?

Unpaid work, illegal activities, environmental damage.

Market regulation by demand-supply — idea?

Prices adjust automatically without state intervention.

State regulation — purpose?

Correct market failures like inflation and unemployment.

Etat-gendarme — role?

Limited to sovereign functions, minimal market intervention.

Etat-providence — role?

Active management to stabilize and support economy.

Inflation rate — measurement?

Change in price level over time.

Imported inflation — cause?

Exchange rate movements affecting import prices.