The inflationary gap measures the difference between the current level of real GDP and the GDP that would exist if the economy were operating at full employment.
For a gap to be considered inflationary, current real GDP must be higher than potential GDP.
Policies that could narrow the inflation gap include cutting government spending, raising taxes, issuing bonds and securities, raising interest rates, and cutting transfer payments.
An absolute advantage is when a manufacturer can provide a greater quantity of a product or service for the same price or the same quantity at a lower price than its competitors.
Autarky refers to a state of self-sufficiency and is commonly used to describe countries or economies that seek to reduce their dependence on international trade.
The balance of trade (BOT) is the difference between the value of a country’s imports and exports over a given period and is the largest component of a country’s balance of payments (BOP).
The Bretton Woods Agreement and the system created a collective international currency exchange regime that operated from the mid-1940s to the early 1970s.
Cross elasticity of demand is an economic concept that measures the response of the quantity demanded of one good to a change in the price of another good.
Desperate workers are workers who have stopped looking for work because they did not find suitable employment options or were not shortlisted when applying for a job.
The causes of employee frustration are complex and varied.
Dollarization is when a country begins to recognize the US dollar as a medium of exchange or legal tender, along with or instead of the national currency.
Durable Goods Orders is a large-scale monthly survey conducted by the US Census Bureau that measures current industrial activity and is used by investors as an economic indicator.
The Dutch disease is a short description of the paradox that occurs when good news, such as the discovery of large oil reserves, wreaks havoc on a country’s economy as a whole.