Edexcel A Level Economics - Key Economic Concepts - Economic Growth

Gross Domestic Product (GDP) [alternative definition] The total value of all finished goods and services produced within an economy's borders in a given period of time Standards of Living (SoL) The quality of life enjoyed by people. This comprises material aspects (i.e. how much people are getting of the things they want and need), and non-material aspects (i.e. how healthy, educated, and happy they are) Short-run economic growth The change in the actual value of GDP measured in an economy in one period of time compared to another. It is the measured change in the level of economic activity which is a key focus for economic policy-makers and the media. Another name for short-run economic growth 'actual growth' Long-run economic growth The change in an economy's potential economic output over time resulting from changes in the quantity and quality of the economy's factors of production. It cannot be measured, but is based on estimates of potential economic output. Potential economic output The maximum total output that can be produced by an economy in a given period of time when all factors of production are utilised to their maintainable maximum capacity Nominal Not adjusted for inflation - i.e. measured using the value of money at the time the measurement is taken Real Adjusted for inflation - i.e. measured using the value of money at one particular point in time Quarterly [context of time-periods] Relating to 3-month-long periods of time. Quarter-on-quarter (QoQ) A comparison of activity in one 3-month period of time compared to the preceding 3-month period of time Year-on-year (YoY) A comparison of activity at a point in time compared to a year earlier Gross National Product (GNP) The total value of all finished goods and services produced (whether within the borders of the economy, or overseas) using the factors of production owned by the citizens of an economy Gross National Income (GNI) An economy's GDP plus net overseas interest payments and dividends (intended to measure factor incomes) Purchasing Power Parity (PPP) An exchange rate which expresses the value of one currency in terms of another on the basis of how much of each currency is needed to buy the same basket of goods an