Glossary Terms:

Phillips Curve

Glossary terms from:


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


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


Economic units that demand productive resources from households and supply goods and services to households and government agencies.

Fiscal Policy

Changes in the expenditures or tax revenues of the federal government, undertaken to promote full employment, price stability and reasonable rates of economic growth.

Full Employment

The natural rate of employment; generally considered to be about 93-95 percent of the labor force, allowing for frictional unemployment of 5-7 percent.


Something a person or organization plans to achieve in the future; an aim or desired result.


Tangible objects that satisfy economic wants.


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).


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

Labor Force

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


The amount of money that people pay when they buy a good or service; the amount they receive when they sell a good or service.

Price Level

The weighted average of the prices of all goods and services in an economy; used to calculate inflation.


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


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


The amount of a good or service that producers are willing and able to offer for sale at each possible price during a given period of time. Normally, as the price of a good or service rises (or falls), the quantity supplied of the good or service rises (or falls).


Compulsory payments to governments by households and businesses.


The giving up of one benefit or advantage in order to gain another regarded as more favorable.


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

Unemployment Rate

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


Payments for labor services that are directly tied to time worked, or to the number of units of output produced.


People employed to do work, producing goods and services.