Chapter 13 ---- Measuring the Economy

1. 13.2 - How to Economics Measure the Size of an Economy?

1.1. Microeconomics vs Macroeconomics

1.2. A formula is used to calculate the GDP which is how the measure a countries wealth and economy

1.3. They also use the GDP of a country to measure if the country is growing or not.

1.4. GDP - The market value of all goods and services

1.5. Current dollars - The value of the dollars spend that year

2. 13.3 - What Does the Unemployment Rate Tell us about the Economy's Health?

2.1. A high unemployment rate means that the economy is poor

2.2. The BLS surveys about 60,000 households to gauge the overall country

2.3. Some aspects make the results not exact and can mess the numbers up a bit

2.4. Unemployment rate - The percentage of the workforce actively seeking work

2.5. Frictional Unemployment - When an individual quits one job and is looking for another

3. 13.4 - What Does the Inflation Rate Reveal about an Economy's Health?

3.1. Runaway Inflation can send an economy in a tailspin

3.2. The BLS tracks inflation by looking at the cost of living

3.3. The Inflation rate means that the value of currency has changed, the higher it is the worse of the value of money is

3.4. Inflation Rate - The percentage increase of the price of goods and services over a period of time

3.5. Price Index - measures the average change in price of a type of good over time

4. 13.5 - How does the Business Cycle Relate to Economic Health

4.1. When the cycle is in expansion, the economy is expanding, meaning more jobs and less unemployed and more money over all in the economy

4.2. Economics try to predict the cycle and time when a certain event within is going to happen based on economic indicators

4.3. Expansion and decline can go on for years, for example, in the 1920s the Economy was in expansion for the decade, and then the Great Depression in the 1930s was the decline

4.4. Business Cycle - The periods of growth and decline within an economy

4.5. Inventories - Merchandise that stores or sellers have on hand