ch6_Macroeconomics

Alternating periods of economic growth and contraction, wich can be measured by changes in real GDP.

• Peak
• Recession
• Trough
• Recovery

Is where the real GDP reaches its maximun after rising during a recovery

A downturn in the business cycle, during which real GDP declines and the unemplyment rate rises. Also call contaction.

The phase in wich real GDP reaches its maximum after falling during a recession

An upturn in the cycle. Also called "expansion"

An expansion in national output measured by the annual % increase in a nation's real GDP

• Leading,
• Coincident &
• Lagging indicators

Variables that change before real GDP change

Variables that change at the same time that real GDP changes.

Variables that change after real GDP changes.

The % of people in the civilian labor force who are without jobs and are actively seeking for job

The # of people >16 who are employed or seeking for job. Excluding armed forces, homemakers, discourage workers etc

unemployed / civilian labor force X 100

• 1) Frictional
• 2)Structural
• 3)Cyclical

Is the unemployment caused by the normal search time requiered by workers with marketable skills who are changing jobs, initially entering the labor force, reentering the labor force, or seasonally unemployed.

Unemployment cause by a mismatch of the skills of workers out of work and the skills required for existing job opportunities.Also for changes indemand and implementations of technology.

Unemployment caused by the lack of jobs during a recession.

The situation in which an economy operates at an unemployment rate equal to the sum of the frictional and structural unemployment rates. Also called the Natural rate of unemployment.

• The difference between actual real GDP and potential or full-employment real DGP.
• Formula: GDP gap = actual real GDP - potential real GDP