Question

Define the terms and give examples for each:
1.Economics
2.GDP
3.Short term
4. Aggregate
5.Business Cycle

Thank you!!

Answer 1

1. Economics is the social science that analyzes the production, distribution, and consumption of goods and services in a society. There are two branches of study in economics one being microeconomics which analyzes the choices made by individual consumers and businesses in attempt to understand how their choices interact in markets while the other branch of economics is macroeconomics which analyzes the performance of the national and global economy

2. Gross domestic product (GDP) is the value of all final goods and services produced within a country's borders in a given year. GDP is a vital way to assess the overall economic "health" of a country.

3. In economics, the phrases "short term/run" and "long run" do not refer to particular lengths of time, such as three weeks or 10 years, as they do in accounting or other disciplines. They can be any length of calendar time.

The short run/term is defined as the period in which the quantity of at least one factor of production is fixed and cannot be changed. A factor of production (also called a resource or input) is an item used during the making of goods and services. In manufacturing, capital (what is owned by the corporation that contributes to the manufacturing of products but is not sold directly; e.g., factories) is typically fixed, while inputs of labor and raw materials can be increased more quickly to make more of a product when sales are rising.

4. Aggregate means the total or te collection of a term as a whole.

5. An interval of expansion and contraction in the economy is known as a business cycle. Business cycles are the up and down fluctuations in the economy around the long-term growth trend. In other words, while the economy tends to grow positively over time, there are short-run fluctuations around that trend. Sometimes the level of GDP in an economy expands, or grows larger, and other times it contracts, or grows smaller, because of fluctuations in economic activity. One business cycle can be viewed as a single period of expansion followed by a single period of contraction. Linearly, a business cycle takes the form of a wave-like pattern, with four phases: expansion, peak, contraction, and a trough. This constitutes one full business cycle.