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Eco 372 Week 2

In: Business and Management

Submitted By cleatuspay
Words 710
Pages 3
Fundamentals of Macroeconomics
Cleatus D. Payne
ECO 372
July 18, 2013
Arnella Trent

Part 1
Describe the following terms: Gross domestic product GDP is the market value price of good or product that a country pays during a certain time of the year. Real GDP is the output of countries products without measuring in inflation. Nominal GDP is where the market value of goods or products is higher than Real GDP. Unemployment rate is the rate of unemployed people who are faithfully seeking employment. Inflation rate is the rise in prices and the lack of being able to purchase products. Interest rate is the rate in which products are paid for at a different price depending on the rate given.
Part 2 Economic activities: Purchasing of groceries, Massive layoff of employees and
Decrease in taxes. The purchasing of groceries effects a household by the amount of groceries needed depending on the size of the family. The larger the family, the higher the grocery bills. This affects the government because of taxes being paid on the groceries the higher the taxes the less groceries a family may be able to purchase. Businesses are effective with prices rising less money being spent groceries that not an essential to a family. A massive layoff affects the household by no income no way to take care of the family. The government is effective by massive layoff because the government will have to pay unemployment. Businesses are affected because without sufficient employees the business could not operate sufficiently. Decrease taxes can affect a household because more money may be spent with lesser taxes. The flow of resources for purchasing of groceries go hand in hand with taxes being decreased because a family would have a more purchasing power of groceries with lower taxes for food and products. In today’s economy, everyone has been suffering…...

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