Glossary Terms:

One of many choices or courses of action that might be taken in a given situation.

A spending-and-savings plan, based on estimated income and expenses for an individual or an organization, covering a specific time period.

Any activity or organization that produces or exchanges goods or services for a profit.

Attempts by two or more individuals or organizations to acquire the same goods, services, or productive and financial resources. Consumers compete with other consumers for goods and services. Producers compete with other producers for sales to consumers.

An amount that must be paid or spent to buy or obtain something. The effort, loss or sacrifice necessary to achieve or obtain something.

Unemployment caused by fluctuations in the overall rate of economic activity or phase of the business cycle.

The quantity of a good or service that buyers are willing and able to buy at all possible prices during a period of time.

The allocation or dividing up of the goods and services a society produces.

The central bank of the United States. Its main function is controlling the money supply through monetary policy. The Federal Reserve System divides the country into 12 districts, each with its own Federal Reserve bank. Each district bank is directed by its nine-person board of directors. The Board of Governors, which is made up of seven members appointed by the President and confirmed by the Senate to 14-year terms, directs the nation's monetary policy and the overall activities of the Federal Reserve. The Federal Open Market Committee is the official policy-making body; it is made up of the members of the Board of Governors and five of the district bank presidents.

Unemployment caused by the short-term movement of people between jobs and by first-time job seekers entering the labor force; always present in a dynamic economy.

Tangible objects that satisfy economic wants.

Spending by all levels of government on goods and services; includes categories like military, schools and roads.

Payments earned by households for selling or renting their productive resources. May include salaries, wages, interest and dividends.

A rise in the general or average price level of all the goods and services produced in an economy. Can be caused by pressure from the demand side of the market (demand-pull inflation) or pressure from the supply side of the market (cost-push inflation).

A practice or arrangement whereby a company provides a guarantee of compensation for specified forms of loss, damage, injury or death. People obtain such guarantees by buying insurance policies, for which they pay premiums. The process allows for the spreading out of risk over a pool of insurance policyholders, with the expectation that only a few policholders will actually experience losses for which claims must be made. Types of insurance include automobile, health, renter's, homeowner's, disability and life.

The purchase of capital goods (including machinery, technology or new buildings) that are used to produce goods and services. In personal finance, the amount of money invested in stocks, bonds, mutual funds and other investment instruments.

A piece of work usually done on order at an agreed-upon rate. Also a paid position of regular employment.

The quantity and quality of human effort available to produce goods and services.

The people in a nation who are aged 16 or over and are employed or actively looking for work.

Places, institutions or technological arrangements where or by means of which goods or services are exchanged. Also, the set of all sale and purchase transactions that affect the price of some good or service.

A good or service that can be used to satisfy a want.

A process of manufacturing, growing, designing, or otherwise using productive resources to create goods or services used to to satisfy a want.

The amount of output (goods and services) produced per unit of input (productive resources) used.

A decline in the rate of national economic activity, usually measured by a decline in real GDP for at least two consecutive quarters (i.e., six months).

Activities performed by people, firms or government agencies to satisfy economic wants.

The exchange of goods and services for money or other goods and services.

Their are varying types and degrees of unemployment. Cyclical unemployment occurs with downturns in the economy and evaporates when the economy rebounds. Frictional unemployment details people who are unemployed while transitioning between jobs. Structural unemployment deals with an offset of skilled workers and available jobs. Seasonal unemployment is another situation in which skilled workers are mismatched with the number of jobs. Hidden unemployment the unemployment of potential workers, which is not reflected in official statistics. Hardcore unemployment describes persons who may be unemployable due to physical or mental incapacitation.

The number of people without jobs who are actively seeking work.

The number of unemployed people, expressed as a percentage of the labor force.

Effort applied to achieve a purpose or result, often for pay; skills and knowledge put to use to get something done; employment at a job or in a position; occupation, profession, business, trade, craft, etc.

People employed to do work, producing goods and services.