level of economic welfare and social well-being of an individual and household. It includes material and non-material aspects
define Gross Domestic Product
measures the totalvalue of all finalgoods and servicesnewlyproduced within a geographicalboundary of a country in a givenyear
define Gross National Income
the sum of factor incomes receivable by resident units
define Nominal GDP
measures the value of the economy's final output using prices that prevailed in the current year
Nominal GDP = P x Q
define Real GDP:
measures the value of the economy's final output using prices that prevailed during some fixed base period
Real GDP = P(current) x Q
composite indices
combine two or more indicators to provide a more holistic measurement
Actual growth
measure of real national output of economy over a time period
potential growth
increase in capacity of an economy to produce goods and services, compared from 1 period of time to another
recession
when economy experience two consecutive quarters of negative real GDP growth
unemployment
workers who are of legal working age, who are willing and able to work at the currentwage rate, activelyseekingemployment but unable to findwork
underemployment
labour is under-utilised, working below their productive capacity
eg. working less hours than they like or workers not utilising skills at work
full employment
non-zero, low rate of unemployment that is compatible with price stability,when all those who are able and willing to work have gained employment
productivity
real outputgenerated per unitfactor of inputused
inflation
increase in general price level of goods and services
disinflation
decrease in rate of inflation
deflation
decrease in general price level of goods and services
PPP exchange rate
an exchange rate that would allow a given amount of money in country A to buy the same amount of goods in country B after exchanging it into the currency of country B
sustainable growth
refers to a rate of growth which can be achievedwithoutcausingsignificantothereconomicproblems, particularly for futuregenerations. It implies positive and stablegrowthrate over an extended period of time
inclusive growth
is an economic growth that createsopportunity for allsegments of the population and distributes the benefits of increased prosperity, both monetary and non-monetary terms fairlyacrosssociety