aqa economics unit 2 key terms Watch

buster121
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Hey all, does anyone have a sheet of the the key terms with there defs?

thanks in advance
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Wulf chan
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This would be very useful for me too. Although I can recommend looking though past papers and making note of the definitions in the first question (5 marks)
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kingboom4
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Bump!

I really need something like that at the moment.
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drspa44
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This is more focused on unit 1 than unit 2 (since definitions are always key in unit 1), but here's a list I've made based on (word for word if possible) the definitions in the mark scheme.
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kingboom4
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Bump!Bump!Bump!
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kingboom4
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BUMp!
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kingboom4
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BUMp!
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waltz2
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Might be of some use.
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kingboom4
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(Original post by Jeebus42)
Might be of some use.
thx
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somebodytoldmexo
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I have some

Spoiler:
Show
Chapter 15 – Introducing macroeconomics
Macroeconomics involves the study of the whole economy at the aggregate level.
Ceteris paribus means holding all other factors in the economy constant when examining one part of the economy. It is an important assumption in microeconomics but not generally in macroeconomics.
Free-market economists are also known as neo-classical economists.
Keynesian economists are followers of the economist John Maynard Keynes.
The term depression has no generally agreed definition. It is best to think of it as a long and deep recession. In the UK, a recession is defined as a period of negative economic growth lasting at least 6 months.
Fiscal policy is the use of government spending and taxation to achieve the government’s policy objectives.
Monetary policy is the use of interest rates to achieve the government’s policy objectives.
Monetarism is the belief that as inflation is assumed to be cause by excessive growth of the money supply, monetary policy should be used to control its growth.
Supply-side economics is a branch of free-market economics arguing that government policy should be used to improve the competitiveness and efficiency of markets.


Chapter 16 – The objectives and instruments of macroeconomic policy
A policy instrument is a tool or set of tools used to try to achieve a policy objective.
A policy objective is a target or goal that policy makers aim to “hit”.
A policy conflict occurs when two policy objectives cannot both be achieved at the same time: the better the performance in achieving one objective, the worse the performance in achieving the other.
Governments often trade-off between policy objectives because it may be impossible to achieve two or more objectives simultaneously. They aim for a satisfactory combination.
A policy indicator provides information about what is happening in the economy.


Chapter 17 – Economic growth and the economic cycle
Economic growth is an increase in the economy’s potential level of real output, and an outward movement of the economy’s production possibility frontier.
National income or national output is the flow of new output produced by the economy in a particular period, e.g. a year.
The economic cycle is the fluctuation of real output above and below the trend line of economic growth.
A recession is a fall in real output for 6 months or more.
The output gap is the difference between actual output and the trend growth level of output.

Chapter 18 – Aggregate demand and the circular flow of income
Aggregate demand is the total planned spending on real output produced within the economy.
Consumption is total planned spending by households on real output produced within the economy.
Investment is total planned spending by firms on real output produced within the economy.
Saving is income which is not spent.
The interest rate is the reward for lending savings to somebody else, e.g. a bank, and the cost of borrowing.
Wealth is the stock of assets, or things that have value, which people own.
Technical progress is improvements in methods of production, resulting from invention, innovation and research and development. It often leads to the production of new types of goods and better quality goods.
The accelerator is a change in the level of investment in new capital goods, induced by a change in national income or output. The size of the accelerator depends on the economy’s capital-output ratio.
Equilibrium national income is the level of income at which withdrawals from the circular flow of income equal injections into the flow. In a two-sector model of the economy, national income is in equilibrium when S=I.
A closed economy is an economy with no international trade.
An open economy is an economy with exports and imports.


Chapter 19 – The aggregate demand and aggregate supply macroeconomic model
Macroeconomic equilibrium is the level of real national output at which AD = AS or at which planned injections into the circular flow of income equal planned withdrawals from the flow.
Aggregate demand is the total planned spending on real output produced within the economy.
Aggregate supply is the level of real national output that producers are prepared to supply at different average price levels.
Inflation is a persistent or continuing rise in the average price level.
Reflation is an increase in the level of real output following an increase in aggregate demand.


Chapter 20 – Full employment and unemployment

The claimant count is the method of measuring unemployment according to those people who are claiming unemployment-related benefits (Jobseeker’s Allowance).
The Labour Force Survey is a quarterly survey of households in the UK. Its purpose is to provide information on the UK labour market. The survey seeks information on respondents’ personal circumstances and their labour market status during a period of 1-4 weeks.
According to Beveridge’s definition, full employment means 3% or less of the labour force unemployed. According to the free-market definition, it is the level of employment occurring at the market-clearing real wage rate at which the number of workers employers wish to hire equals the number of workers wanting to work.
Frictional unemployment is voluntary unemployment, occurring when a worker switches between jobs.
Structural unemployment is caused by structural change in the economy, for example when industries decline without being replaced by new industries,
Cyclical unemployment is also known as Keynesian and demand-deficient unemployment. As this name suggests, it is unemployment caused by a lack of aggregate demand in the economy.
Seasonal unemployment is caused by factors such as the weather and the end of the Christmas shopping period.


Chapter 21 – Price stability and inflation
Deflation is a persistent or continuing fall in the average price level.
Inflation is a persistent or continuing rise in the average price level.
Reflation is an increase in the level of real output following an increase in aggregate demand.
Demand-pull inflation is a rising price level caused by an increase in aggregate demand, shown by a shift of the AD curve to the right.
Cost-push inflation is a rising price level caused by an increase in the costs of production, shown by a shift of the SRAS curve to the left.


Chapter 22 – The balance of payments
The current account is the part of the balance of payments measuring income currency flows, especially payments for exports and imports.
An export is a domestically produced good or service sold to residents of other countries.
An import is a good or service produced in another country sold to residents of this country.
Investment income is profit and interest income flowing into a country that is generated from assets that residents of the country own abroad.
Transfers are payments flowing between countries in forms such as foreign aid, grants, and gifts.
The balance of trade in goods is the part of the current account measuring payments for exports and imports of goods. It is sometimes called the balance of visible trade.
A current account deficit occurs when currency outflows in the current account exceed currency inflows. It is often shortened to ‘imports exceeding exports’.
A current account surplus occurs when currency inflows in the current account exceed currency outflows. It is often shortened to ‘exports exceeding imports’.
The balance of trade in services is the part of the current account measuring payments for exports and imports of services. It is sometimes called the balance of invisible trade.


Chapter 23 – Managing the economy: monetary policy
The central bank implements monetary policy on behalf of the government.
A commercial bank, such as Barclays, aims to make a profit from commercial banking business.
Monetary policy is the use of interest rates to achieve the government’s policy objectives.
A policy objective is a target or goal that policy makers aim to hit.
A policy instrument is a tool or set of tools used to try to achieve a policy objective.
The Bank of England’s interest rate is the rate of interest at which the Bank of England lends cash to commercial banks to increase their liquidity.
A current account is a bank account that allows its owner to withdraw cash immediately by using a cheque or a plastic debit card.
Liquidity measures the ease with which assets can be turned into cash quickly and at a pre-known rate or price. Cash is the most liquid of all assets.
A mortgage is a long-term loan to a house owner that is secured by the property.
The lender of last resort function is the Bank of England’s willingness to lend cash to commercial banks to increase their liquidity and to maintain confidence in the banking system.
The money supply is the stock of money in the economy, that mainly takes the form of cash and bank deposits.
Monetarism is the belief that, as inflation is assumed to be caused by excessive growth of the money supply, monetary supply should be used to control this growth.
A policy indicator provides information about what is happening in the economy.


Chapter 24 – Managing the economy: fiscal policy
Fiscal policy tries to achieve policy objectives through the use of government spending, taxation and the government’s budgetary position.
A balanced budget is achieved when government spending equals government revenue (G = T).
A budget deficit occurs when government spending exceeds government revenue (G > T).
A budget surplus occurs when government spending is less than government revenue (G < T).
Deficit financing means deliberately running a budget deficit and borrowing to finance the deficit.
Demand-side fiscal policy is used to increase or decrease the level of aggregate demand (and to shift the AD curve right or left).
Expansionary fiscal policy uses fiscal policy to increase aggregate demand and to shift the AD curve right.
Contractionary fiscal policy uses fiscal policy to decrease aggregate demand and to shift the AD curve left.
The government spending multiplier is the relationship between a change in government spending and the resulting change in national income.
The investment multiplier is the relationship between a change in investment and the resulting change in national income.
The national income multiplier is the relationship between a change in aggregate demand and the resulting change in national income.
The tax multiplier is the relationship between a change in taxation and the resulting change in national income.
Crowding out is a situation in which an increase in government or public sector spending displaces private sector spending, with little or no increase in aggregate demand.
Discretionary fiscal policy involves making discrete changes to G, T and the budget deficit to manage and ‘fine-tune’ the level of aggregate demand.
Supply-side fiscal policy is used to increase the economy’s ability to produce and supply goods, through creating incentives to work, save, invest, and to be entrepreneurial.
The national debt is the stock of all past government borrowing that has not been paid back.
Transfers are the part of government spending in which tax revenues are paid to people such as pensioners, without any output being produced in return.
A progressive tax is one where the proportion of income paid in tax rises as income increases.


Chapter 25 – Managing the economy: supply-side economics and supply-side policies
Supply-side economics is a branch of free-market economics, arguing that government policy should be used to improve the competitiveness and efficiency of markets.
Interpreted narrowly, supply-side policies focus on the role of tax cuts in increasing personal incentives. Interpreted broadly, they aim to improve the economy’s ability to produce and supply more output.
Deregulation involves removing previously imposed regulations.
Marketisation involves shifting provision of goods or services from the non-market sector to the market sector.
Privatisation involves shifting ownership of state-owned assets to the private sector.
The trickle-down effect is income paid by rich people to the poorer people they employ.
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kingboom4
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(Original post by somebodytoldmexo)
I have some

Spoiler:
Show
Chapter 15 – Introducing macroeconomics
Macroeconomics involves the study of the whole economy at the aggregate level.
Ceteris paribus means holding all other factors in the economy constant when examining one part of the economy. It is an important assumption in microeconomics but not generally in macroeconomics.
Free-market economists are also known as neo-classical economists.
Keynesian economists are followers of the economist John Maynard Keynes.
The term depression has no generally agreed definition. It is best to think of it as a long and deep recession. In the UK, a recession is defined as a period of negative economic growth lasting at least 6 months.
Fiscal policy is the use of government spending and taxation to achieve the government’s policy objectives.
Monetary policy is the use of interest rates to achieve the government’s policy objectives.
Monetarism is the belief that as inflation is assumed to be cause by excessive growth of the money supply, monetary policy should be used to control its growth.
Supply-side economics is a branch of free-market economics arguing that government policy should be used to improve the competitiveness and efficiency of markets.


Chapter 16 – The objectives and instruments of macroeconomic policy
A policy instrument is a tool or set of tools used to try to achieve a policy objective.
A policy objective is a target or goal that policy makers aim to “hit”.
A policy conflict occurs when two policy objectives cannot both be achieved at the same time: the better the performance in achieving one objective, the worse the performance in achieving the other.
Governments often trade-off between policy objectives because it may be impossible to achieve two or more objectives simultaneously. They aim for a satisfactory combination.
A policy indicator provides information about what is happening in the economy.


Chapter 17 – Economic growth and the economic cycle
Economic growth is an increase in the economy’s potential level of real output, and an outward movement of the economy’s production possibility frontier.
National income or national output is the flow of new output produced by the economy in a particular period, e.g. a year.
The economic cycle is the fluctuation of real output above and below the trend line of economic growth.
A recession is a fall in real output for 6 months or more.
The output gap is the difference between actual output and the trend growth level of output.

Chapter 18 – Aggregate demand and the circular flow of income
Aggregate demand is the total planned spending on real output produced within the economy.
Consumption is total planned spending by households on real output produced within the economy.
Investment is total planned spending by firms on real output produced within the economy.
Saving is income which is not spent.
The interest rate is the reward for lending savings to somebody else, e.g. a bank, and the cost of borrowing.
Wealth is the stock of assets, or things that have value, which people own.
Technical progress is improvements in methods of production, resulting from invention, innovation and research and development. It often leads to the production of new types of goods and better quality goods.
The accelerator is a change in the level of investment in new capital goods, induced by a change in national income or output. The size of the accelerator depends on the economy’s capital-output ratio.
Equilibrium national income is the level of income at which withdrawals from the circular flow of income equal injections into the flow. In a two-sector model of the economy, national income is in equilibrium when S=I.
A closed economy is an economy with no international trade.
An open economy is an economy with exports and imports.


Chapter 19 – The aggregate demand and aggregate supply macroeconomic model
Macroeconomic equilibrium is the level of real national output at which AD = AS or at which planned injections into the circular flow of income equal planned withdrawals from the flow.
Aggregate demand is the total planned spending on real output produced within the economy.
Aggregate supply is the level of real national output that producers are prepared to supply at different average price levels.
Inflation is a persistent or continuing rise in the average price level.
Reflation is an increase in the level of real output following an increase in aggregate demand.


Chapter 20 – Full employment and unemployment

The claimant count is the method of measuring unemployment according to those people who are claiming unemployment-related benefits (Jobseeker’s Allowance).
The Labour Force Survey is a quarterly survey of households in the UK. Its purpose is to provide information on the UK labour market. The survey seeks information on respondents’ personal circumstances and their labour market status during a period of 1-4 weeks.
According to Beveridge’s definition, full employment means 3% or less of the labour force unemployed. According to the free-market definition, it is the level of employment occurring at the market-clearing real wage rate at which the number of workers employers wish to hire equals the number of workers wanting to work.
Frictional unemployment is voluntary unemployment, occurring when a worker switches between jobs.
Structural unemployment is caused by structural change in the economy, for example when industries decline without being replaced by new industries,
Cyclical unemployment is also known as Keynesian and demand-deficient unemployment. As this name suggests, it is unemployment caused by a lack of aggregate demand in the economy.
Seasonal unemployment is caused by factors such as the weather and the end of the Christmas shopping period.


Chapter 21 – Price stability and inflation
Deflation is a persistent or continuing fall in the average price level.
Inflation is a persistent or continuing rise in the average price level.
Reflation is an increase in the level of real output following an increase in aggregate demand.
Demand-pull inflation is a rising price level caused by an increase in aggregate demand, shown by a shift of the AD curve to the right.
Cost-push inflation is a rising price level caused by an increase in the costs of production, shown by a shift of the SRAS curve to the left.


Chapter 22 – The balance of payments
The current account is the part of the balance of payments measuring income currency flows, especially payments for exports and imports.
An export is a domestically produced good or service sold to residents of other countries.
An import is a good or service produced in another country sold to residents of this country.
Investment income is profit and interest income flowing into a country that is generated from assets that residents of the country own abroad.
Transfers are payments flowing between countries in forms such as foreign aid, grants, and gifts.
The balance of trade in goods is the part of the current account measuring payments for exports and imports of goods. It is sometimes called the balance of visible trade.
A current account deficit occurs when currency outflows in the current account exceed currency inflows. It is often shortened to ‘imports exceeding exports’.
A current account surplus occurs when currency inflows in the current account exceed currency outflows. It is often shortened to ‘exports exceeding imports’.
The balance of trade in services is the part of the current account measuring payments for exports and imports of services. It is sometimes called the balance of invisible trade.


Chapter 23 – Managing the economy: monetary policy
The central bank implements monetary policy on behalf of the government.
A commercial bank, such as Barclays, aims to make a profit from commercial banking business.
Monetary policy is the use of interest rates to achieve the government’s policy objectives.
A policy objective is a target or goal that policy makers aim to hit.
A policy instrument is a tool or set of tools used to try to achieve a policy objective.
The Bank of England’s interest rate is the rate of interest at which the Bank of England lends cash to commercial banks to increase their liquidity.
A current account is a bank account that allows its owner to withdraw cash immediately by using a cheque or a plastic debit card.
Liquidity measures the ease with which assets can be turned into cash quickly and at a pre-known rate or price. Cash is the most liquid of all assets.
A mortgage is a long-term loan to a house owner that is secured by the property.
The lender of last resort function is the Bank of England’s willingness to lend cash to commercial banks to increase their liquidity and to maintain confidence in the banking system.
The money supply is the stock of money in the economy, that mainly takes the form of cash and bank deposits.
Monetarism is the belief that, as inflation is assumed to be caused by excessive growth of the money supply, monetary supply should be used to control this growth.
A policy indicator provides information about what is happening in the economy.


Chapter 24 – Managing the economy: fiscal policy
Fiscal policy tries to achieve policy objectives through the use of government spending, taxation and the government’s budgetary position.
A balanced budget is achieved when government spending equals government revenue (G = T).
A budget deficit occurs when government spending exceeds government revenue (G > T).
A budget surplus occurs when government spending is less than government revenue (G < T).
Deficit financing means deliberately running a budget deficit and borrowing to finance the deficit.
Demand-side fiscal policy is used to increase or decrease the level of aggregate demand (and to shift the AD curve right or left).
Expansionary fiscal policy uses fiscal policy to increase aggregate demand and to shift the AD curve right.
Contractionary fiscal policy uses fiscal policy to decrease aggregate demand and to shift the AD curve left.
The government spending multiplier is the relationship between a change in government spending and the resulting change in national income.
The investment multiplier is the relationship between a change in investment and the resulting change in national income.
The national income multiplier is the relationship between a change in aggregate demand and the resulting change in national income.
The tax multiplier is the relationship between a change in taxation and the resulting change in national income.
Crowding out is a situation in which an increase in government or public sector spending displaces private sector spending, with little or no increase in aggregate demand.
Discretionary fiscal policy involves making discrete changes to G, T and the budget deficit to manage and ‘fine-tune’ the level of aggregate demand.
Supply-side fiscal policy is used to increase the economy’s ability to produce and supply goods, through creating incentives to work, save, invest, and to be entrepreneurial.
The national debt is the stock of all past government borrowing that has not been paid back.
Transfers are the part of government spending in which tax revenues are paid to people such as pensioners, without any output being produced in return.
A progressive tax is one where the proportion of income paid in tax rises as income increases.


Chapter 25 – Managing the economy: supply-side economics and supply-side policies
Supply-side economics is a branch of free-market economics, arguing that government policy should be used to improve the competitiveness and efficiency of markets.
Interpreted narrowly, supply-side policies focus on the role of tax cuts in increasing personal incentives. Interpreted broadly, they aim to improve the economy’s ability to produce and supply more output.
Deregulation involves removing previously imposed regulations.
Marketisation involves shifting provision of goods or services from the non-market sector to the market sector.
Privatisation involves shifting ownership of state-owned assets to the private sector.
The trickle-down effect is income paid by rich people to the poorer people they employ.
Brilliant Keep them coming!
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kingboom4
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BUMp!
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kingboom4
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Economics unit 2 super bump!
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kingboom4
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bump
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waltz2
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You're getting quite tedious now. What more do you expect?
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Jim Riley
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I recommend everyone taking AS Economics Unit 2 (all boards) read this before tomorrow

http://www.tutor2u.net/blog/index.ph...gs-in-context/

there are separate blog entries referred to it at the end of the post which also explain all the key terms you need for unit 2

Jim
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creativebuzz
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rowse
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Thank you! Bump!
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