Running head: TERM DEFINITION PAPER
Term Definition Paper
University of Phoenix
ECO 372- Daniel Rowe
June 11, 2008
Abstract
Economics is used in almost all aspects of life. It is about choice and decision making. An understanding of economics will illustrate how to live and exist in our world today and understand how the business world functions. As the concept of economics is discussed, many terms are used to describe how economics works in the real world. These terms will be defined so that they will be understood throughout the discussion of the economy and market demand.
Term Definition Paper
Terminology
To help understand the concept of economics, terms are defined and used to describe the economy and market demand. The terms Gross Domestic Product (GDP), Real Gross Domestic Product, Unemployment Rate, Inflation Rate, and Interest Rate, help to break down the analysis of economics and give a better understanding of the direction our economy is headed. This area of study gives further consideration to other concepts, like a circular flow diagram that illustrates the interaction of households, government, and business.
Gross Domestic Product
Gross Domestic Product, or GDP, is a tool which helps measure the economic health and strength of a country. It is one way to measure the size of an economy via the total market value of all final goods and services produced within a country in a given period of time, usually one calendar year. GDP is usually expressed in relation to the previous year (Investopedia, 2008). For example, GDP in the United States in 2006 was 3.1%. In 2007 GDP was 2%. This means that the economy of the United States was up only 2% fro ...