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ECONOMICS
Economy Types
There are four types of economy in the United States
Agricultural
Service
Industrial
Information
Measuring Economic Activity
Economic Indicators: Measure things like production rate,
economic growth, and how it compares to other
countries
Gross Domestic Product
Unemployment Rate
Rate of Inflation
National Debt
Gross Domestic Product (GDP)
The total value of the goods and services in a country
in country
Determined by productivity
Calculated by the sum of the following goods and
services:
Consumer goods and services
Business goods and services
Government goods and services
Goods and services sold to other countries (exports)
Gross Domestic Product (GDP)
Effect standard of living which is the amount of goods
and services the average citizen can buy
Gross Domestic Product (GDP)
Unemployment Rate
Measures the number of the people who are able
to work but do not have a job during a given period of
time
Participation Rate: A measure of the active portion of
an economy's labor force. The participation rate refers
to the number of people who are either employed or
are actively looking for work.
Service
Industrial
Information
Unemployment Rate
Rate of Inflation
General increase in the cost of goods and services.
the opposite is deflation.
The more
people are
employed
Producers
raise prices
again to
offset labor
cost
The more
they spend
Demand
goes up
Wages go up
To pay higher
prices higher
wages
demanded
Producers
raise prices
Can spiral out of control and
leads to Hyperinflation
Rate of Inflation
Deflation is a general decrease of goods and services
Countries
overproduce
Demand
continues to
drop
Prices are
lowered
People have
less money
Production is
reduced
Wages
stagnate or
are reduced
Jobs are lost
Rate of Inflation
National Debt
The amount of money a government owes
Government earns money through taxes
Budget deficit is when a country takes less money than
they owe
Budget surplus is when the country takes in more money
than it owes
National Debt
Questions
1) What are the reasons for unemployment
2) What is the difference between inflation and
deflation
3) List the four factors of GDP
4) What is the current GDP rate