Monday, January 24, 2011


On the Gini index for the nations of the world they put the United States in 56th place. I was also shocked that America was above the top 50 countries with the least income inequality.


Seasonal unemployment- I'm an agricultal worker who works in the fields gathering seasonal fruits and when the season ends I go and look for work at another plantation.

Cyclical unemployment- I was an office worker at a corporate company, but the company layoff half of the staff including me because of a downturn in the business cycle.

Frictional unemployment- I'm a teacher that quit my job at a high school to look for a better teaching job at other schools.

Structral unemployment- I was a tax preparer at H&R block ,but was layoff because more people are using turbo tax at home and not coming to our company to help them with their taxes.


Wednesday, January 19, 2011


1. Census Bureau conducts a monthly study called the Current Population Survey.
2. Structural unemployment that results from changes in technology or in the way the economy is structured.
3. Seasonal unemployment affects agricultural workers.
4. Frictional unemployment attributed to workers moving from one job to another.
5. Underemployed workers who have jobs beneath their skill level.
6. Rapid changes in technology have led to a drop in demand in lower-skilled worker.
7. Poverty thresholds are adjusted annually based on changes in the consumer price index.
8. The poverty threshold is the lowest income level that a family needs maintain a basic standard of living.
9. To measure the amount of inequality in the distribution of income, economists plot a Lorenz Curve.
10. The data used to plot a Lorenz Curve can also be used to compute the Gini Index.
11. The worst degree of inflation is called hyperinflation.
12. High interest rates lead to less consumer spending.
13. Economists use price indexes to calculate the inflation rate.
14. Aggregate supply is the total amount of goods and services produced throughout the economy.
15. As the value of the dollar decreases, the purchasing power of people who rely on fixed income will fall.

Post21: Vocab list

National income accounting - the process used for tracking production, income, and consumption in a nation's economy.

Gross domestic product (GDP) – the total dollar value of all final goods and services produced within a country in a given year.

Output-expenditure model - a method of computing the gross domestic product (GDP) by adding the total value of consumer and government spending on goods and services, total private investment, and total value of exports, and then subtracting the total value of imports. 

Personal consumption expenditure - total spending by consumers for durable goods, nondurable goods, and services during a specified period of time. 

Gross investment - the total value of private spending in the economy for capital assets- such as new equipment, machinery, and buildings- over a specified period of time, plus total changes in business inventories. 

Nominal GDP- the value of a nation's gross domestic product (GDP) at the current prices of the period being measured.

Real GDP - the value of a nation's gross domestic product (GDP) after it has been adjusted for inflation.

Price index- a set of statistics that allows economists to compare prices over time.

Underground economy - illegal economic activities or unreported legal activities that are not accounted for in national economic measures.

Gross national product (GNP) - the total dollar value of all final goods and services produced with factors of production owned by citizens of a given country.

Leading Indicators- anticipate the direction in which the economy is headed.
Coincident Indicators- change as the economy moves from one phase of the business's cycle to another and tell economists that an upturn or a downturn in the economy has arrived.
Lagging Indicators- change months after an upturn or a downturn in the economy has begun and help economists predict the duration of economic upturns or downturns.

Peak- a high point in which the economy is at its strongest and most prosperous.

Contraction – a period in the business cycle during which business activity slows down and overall economic indicators decline.

Recession – a substantial and general decline in overall business activity over a significant  period of time.

Trough – the lowest point of a business cycle, in which demand, production, and employment reach their lowest levels.

Business cycle- a recurring pattern in economic activity that is characterized by alternating periods of expansion and contraction.

Depression - a prolonged and severe recession.

Real GDP per capita-  the dollar value- adjusted for inflation- of all final goods and services prduced pe person in an economy n a gven year.

Labor productivity- a measure of how much each worker produces in a given period of time.

Productivity growth- an increase in output per given level of input.

Capital-to-labor ratio- the amount of capital resources available per worker.

Capital deepening- the increasing of capital resources at a faster rate than the increasing of the labor force, causing a rise in the capital-to-labor ratio.  

Tuesday, January 18, 2011


Reviewing Facts:
2. b. a. the nominal GDP is the current GDP.

Identifing Ideas:
5. gross. net. Net domestic product is a more representative measure of a nation's actual output of new goods than GDP because it doesn't include depreciation.

Understanding Ideas:
2. none. d. a,b, and c are use to avoid double counting when economists measure GDP.
3. none. d. a,b, and c are use by economists to create a price index.
7. none. d. a,b, and c are examples of a coincident indicator.
8. none. a. use of consumer installment credit is an example of a lagging indicator.

2. i. b. Nominal GDP is the value of a nation's gross domestic product at the current prices of the period being measured.
4. t. f. Unlike GDP, the GNP included the income of the overseas divisions of U.S companies. 

expansion. peak. it is turning point of the economy.
peak. expansion. it is when economic activity is increasing toward a peak. 

C+I+G+(X-M)= GDP
C- Personal consumption expenditures: is the sum of expenditures by household by durable goods, nondurable goods, and services.
I- Gross investment: is the sum of expenditures on capital equipment, inventories, and structures
G-Government purchases: is the sum of expenditures by all government bodies on goods and services.
X-M-Net Exports and Imports: equals the difference between spending on domestic goods by foreigners and spending on foreign goods by domestic resident.

Tuesday, January 11, 2011


These are the 3 sites that I think would be allowed to be use on the mid-term.

Economic Guides - it has the the things that we have learn about the economy in the class.

United States Treasury Department- it shows the types of economic structures we learned from the lessons.

Web Glossary Financial and Business Terms - it has all the economic vocab words that we have learned.