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26 terms

GLE59 -- Economic Indicators

59. Explain the meaning of various economic indicators that help describe the state of an economy (e.g., GDP, CPI, stock market indices, rate of unemployment or inflation) (E-1C-M1)
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Indicators
___ measure the health of a system.
health
Your ___ is indicated by measurements such as pulse, blood pressure, and temperature.
economy
The health of an ___ is measured by economic indicators such as Gross Domestic Product and inflation.
DJIA
The adjusted average of 30 industrial stocks. If it is down: Investors have lost confidence in American industry relative to other investments. If it is up: Investors have gained confidence in American industry relative to other investments.
GDP
Definition: "the market value of the goods and services produced by labor and property located in the United States [or other nation]." If it is down: The economy is slowing. The Federal Reserve may lower interest rates. If it is up: The economy is accelerating. The Federal Reserve may raise interest rates if it is concerned about inflation or an economic bubble.
Dow Jones Industrial Average
DJIA stands for...
Gross Domestic Product
GDP stands for...
Gross National Product
GNP stands for...
GNP
The value of all final goods and services produced within a nation in a given year, plus income earned by its citizens abroad, minus income earned by foreigners from domestic production.
CPI
A measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. If it is down: A large drop in the CPI would indicate deflation; a small drop could mean a lower rate of inflation. If it is up: Inflation or hyperinflation.
Consumer Price Index
CPI stands for...
NASDAQ
The ___ is a tech-heavy electronic stock exchange. If it is down: Investors are losing confidence in high-technology companies. If it is up: Investors are gaining confidence in high-technology companies.
Unemployment Rate
People who are jobless, looking for jobs, and available for work are unemployed are counted in the ___. If it is down: The economy is strong -- employers are hiring and keeping employees. If it is up: The economy is weak -- employers are laying off workers.
not in the labor force
So what about people who just aren't looking for work but don't have jobs? The BLS refers to them as "___." These include anyone younger than 16, in prison, in a mental institution, or on active duty in the armed forces (the unemployment rate only involves civilians).
inflation
The rise in prices of goods and services. A little ___ is considered healthy.
deflation
Negative inflation (a drop in prices) is called "___."
growing
A low rate of inflation means the economy is slowly ___.
hyperinflation
High inflation or ___ destroys the value of savings and creates poverty.
money
Deflation is caused by a decline in the supply of ___ or credit.
shortages
A slow economy may cause ___.
New York Stock Exchange
NYSE stands for...
NYSE
The ___ is the world's largest stock exchange.
fiat
The Dollar is "___ money." It has value because the government has ordered that it have value. It is not based on the value of gold or any other commodity.
gold
When investors are not confident in the glocal economy they tend to invest in...
Light sweet
___ crude is the best grade of oil.
oil
An increase in the price of ___ may mean that the supply of ___ has decreased, the demand increased, or the political situation in the Middle East is turbulent.