Economic Factors Flashcards
What is meant by GDP?
Gross Domestic Product
Define GDP
The total output of an economy. The size of the economy is measured by adding up the value of all goods and services sold in an economy in one year
What does it mean if GDP decreases?
The economy is shrinking
What are the impacts of the economy shrinking (GDP going down)?
Job cuts and falling house prices
What happens if GDP rises?
More wealth, new jobs, increased house prices
What is happening if GDP increases?
The economy is growing/ expanding
What products does GDP include?
Cars, housing, roadworks, transport, health care, shopping EVERY OUTPUT
What are the limitations of GDP?
It only tells us what’s happened not what’s happening or what’s going to happen
Define economic growth
The annual percentage change in GDP
What can the government do to facilitate GDP?
Encourage investment in physical capital by offering subsidies or lowering taxation, improve infrastructure, invest in education
What is GDP capita?
The measure of economic output which accounts for the population of the country GDP/ TOTAL POPULATION
