794451
| Question | Answer |
| Unemployment | Unused resources |
| Inflation | A sustained increase in the general level of prices |
| Monetary policy | Controls the amount and value of money in the economy |
| Supply-side policies | Measures intended to directly affect aggregate supply and the potential capacity output of the economy |
| GDP | Measure of economic activity in a period |
| Productivity | Measures output relative to input |
| RPI | Retail Price Index - Measures inflation |
| CPI | Consumer Price Index. Measures inflation |
| Demand-pull inflation | AD grows quicker than supply. Higher spending results in upward pressure in prices |
| Cost-push inflation | higher costs lead to expensive materials so prices have to be increased |
| Deflation | A sustained fall in the general price level |
| Current account | Difference between the value of X and M |
| Exchange Rate | Price of one currency in terms of another |
| Protectionism | Attempt to reduce imports by increasing price, reducing quantity or using regulation to deter foreign sellers. |
| Monetary policy transmission mechanism | how changes in base rate influence spending decisions and how they affect macroeconomic variables |
| capital spending | investment in infrastructure |
| current spending | funds day-to-day running of the public sector |
| NICE | Non Inflationary Constant Expansion |
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