3.1.2 standard of living and its indicators

Cards (19)

  • define standard of living
    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 total value of all final goods and services newly produced within a geographical boundary of a country in a given year
  • 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 current wage rate, actively seeking employment but unable to find work
  • 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 output generated per unit factor of input used
  • 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 achieved without causing significant other economic problems, particularly for future generations. It implies positive and stable growth rate over an extended period of time
  • inclusive growth
    is an economic growth that creates opportunity for all segments of the population and distributes the benefits of increased prosperity, both monetary and non-monetary terms fairly across society