AP Macro Ch. 26
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9 terms
Terms | Definitions |
|---|---|
 Business Cycle | Peak: temp. max output and full emp. Recession: dec. in output, income, emp, and trade Trough: bottom of recession Recovery: output and emp. expand towards full emp. |
| Causes of Business Cycle | -irregular innovation triggering Ig or C -level of aggregate spending (rGDP, or AD) -wars or expansion of money supple |
| Non- cyclical Fluctuations | -seasonal variations (tourism, farmers, etc) -housing, secular trends |
| Cyclical Fluctuations | -durable goods and construction experience largest impact by cyclical fluctuations because these purchased can be postponed |
| Frictional Unemployment | have skills but trying to find a new job |
| Structural Unemployment | change in skills demand leaves you lacking those skills |
| Cyclical Unemployment | because of a recession |
| Labor Force | NOT included: under age 16, institutionalized ARE included: over 16, willing and able to work |
| Unemployment Rate | -percentage of labor force not employed - (Unemployed / labor force) x 100 -employed = part time workers -not employed= discouraged workers (not seeking work) |
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