OCR A level Economics
Course exam|complete
study guide with updated
answers|newest 2025
structural unemployment - CORRECT ANSWERS✔️✔️unemployment arising
because of changes in the pattern of economic activity within an economy
real value - CORRECT ANSWERS✔️✔️value of an economic variable, taking
account of changing prices through time
retall price index (RPI) - CORRECT ANSWERS✔️✔️a measure of the average level
of prices in the UK
revaluation - CORRECT ANSWERS✔️✔️process whereby a government raises the
price of domestic currency in terms of foreign currency
seasonal unemployment - CORRECT ANSWERS✔️✔️unemployment that arises in
seasons of the year when demand is relatively low
supply-side policies - CORRECT ANSWERS✔️✔️range of measures intended to
have a direct impact on aggregate supply - and specifically the potential capacity
output of the economy
trading possibilities curve - CORRECT ANSWERS✔️✔️shows the consumption
possibilities under conditions of free trade
,unemployed - CORRECT ANSWERS✔️✔️people who are economically active but
not in employment
visible trade - CORRECT ANSWERS✔️✔️trade in goods
voluntary unemployment - CORRECT ANSWERS✔️✔️situation arising when an
individual chooses not to accept a job at the going wage rate
real exchange rate - CORRECT ANSWERS✔️✔️the nominal exchange rate
adjusted for differences in relative inflation rates between countries
purchasing power parity theory of exchange rates - CORRECT
ANSWERS✔️✔️theory stating that the long run exchange rates (in a floating rate
system) are determined by relative inflation rates in different countries
law of comparative advantage - CORRECT ANSWERS✔️✔️a theory arguing that
there may be gains from trade arising when countries specialise in the production
of goods or services in which they have a comparative advantage
marginal propensity to consume - CORRECT ANSWERS✔️✔️the proportion of
additional income devoted to consumer expenditure
marginal propensity to import - CORRECT ANSWERS✔️✔️the proportion of
additional income that is spent on Imports of goods and services
,marginal propensity to save - CORRECT ANSWERS✔️✔️the proportion of
additional income that is saved by households
marginal propensity to tax - CORRECT ANSWERS✔️✔️the proportion of
additional income that is taxed
Monetarist School - CORRECT ANSWERS✔️✔️a group of economists who
believed that the macroeconomy always adjusts rapidly to the full employment
level of output
productivity - CORRECT ANSWERS✔️✔️measure of the efficiency of a factor of
production
money stock - CORRECT ANSWERS✔️✔️the quantity of money in the economy
multiplier - CORRECT ANSWERS✔️✔️the ratio of a change in equilibrium real
income to the autonomous change that brought it about; it is defined as 1 divided
by the marginal propensity to withdraw
natural rate of output - CORRECT ANSWERS✔️✔️the long. run equilibrium level
of output to which monetarists believe the macroeconomy will always tend;
corresponds to full employment
net investment - CORRECT ANSWERS✔️✔️gross investment minus depreciation
nominal value - CORRECT ANSWERS✔️✔️value of an economic variable based on
current prices. taking no account of changing prices through time
, absolute advantage - CORRECT ANSWERS✔️✔️a country's ability to produce
good using less resources than another country
aggregate demand (AD) curve - CORRECT ANSWERS✔️✔️the relationship
between the level of aggregate demand and the overall price level, it shows
planned expenditure at any given possible overall price level
appreciation - CORRECT ANSWERS✔️✔️a rise in the exchange rate within a
floating exchange rate system
average propensity to consume - CORRECT ANSWERS✔️✔️the proportion of
income that households devote to consumer expenditure
balance of payments - CORRECT ANSWERS✔️✔️a set of accounts showing the
transactions conducted between residents of a country and the rest of the world
Canons of Taxation - CORRECT ANSWERS✔️✔️four maxims devised by Adam
Smith, setting out the characteristics of good tax
capital account of the balance of payments - CORRECT ANSWERS✔️✔️account
identifying transactions in (physical) capital between the residents of country and
the rest of the world
capital productivity - CORRECT ANSWERS✔️✔️measure of output per unit of
capital
Course exam|complete
study guide with updated
answers|newest 2025
structural unemployment - CORRECT ANSWERS✔️✔️unemployment arising
because of changes in the pattern of economic activity within an economy
real value - CORRECT ANSWERS✔️✔️value of an economic variable, taking
account of changing prices through time
retall price index (RPI) - CORRECT ANSWERS✔️✔️a measure of the average level
of prices in the UK
revaluation - CORRECT ANSWERS✔️✔️process whereby a government raises the
price of domestic currency in terms of foreign currency
seasonal unemployment - CORRECT ANSWERS✔️✔️unemployment that arises in
seasons of the year when demand is relatively low
supply-side policies - CORRECT ANSWERS✔️✔️range of measures intended to
have a direct impact on aggregate supply - and specifically the potential capacity
output of the economy
trading possibilities curve - CORRECT ANSWERS✔️✔️shows the consumption
possibilities under conditions of free trade
,unemployed - CORRECT ANSWERS✔️✔️people who are economically active but
not in employment
visible trade - CORRECT ANSWERS✔️✔️trade in goods
voluntary unemployment - CORRECT ANSWERS✔️✔️situation arising when an
individual chooses not to accept a job at the going wage rate
real exchange rate - CORRECT ANSWERS✔️✔️the nominal exchange rate
adjusted for differences in relative inflation rates between countries
purchasing power parity theory of exchange rates - CORRECT
ANSWERS✔️✔️theory stating that the long run exchange rates (in a floating rate
system) are determined by relative inflation rates in different countries
law of comparative advantage - CORRECT ANSWERS✔️✔️a theory arguing that
there may be gains from trade arising when countries specialise in the production
of goods or services in which they have a comparative advantage
marginal propensity to consume - CORRECT ANSWERS✔️✔️the proportion of
additional income devoted to consumer expenditure
marginal propensity to import - CORRECT ANSWERS✔️✔️the proportion of
additional income that is spent on Imports of goods and services
,marginal propensity to save - CORRECT ANSWERS✔️✔️the proportion of
additional income that is saved by households
marginal propensity to tax - CORRECT ANSWERS✔️✔️the proportion of
additional income that is taxed
Monetarist School - CORRECT ANSWERS✔️✔️a group of economists who
believed that the macroeconomy always adjusts rapidly to the full employment
level of output
productivity - CORRECT ANSWERS✔️✔️measure of the efficiency of a factor of
production
money stock - CORRECT ANSWERS✔️✔️the quantity of money in the economy
multiplier - CORRECT ANSWERS✔️✔️the ratio of a change in equilibrium real
income to the autonomous change that brought it about; it is defined as 1 divided
by the marginal propensity to withdraw
natural rate of output - CORRECT ANSWERS✔️✔️the long. run equilibrium level
of output to which monetarists believe the macroeconomy will always tend;
corresponds to full employment
net investment - CORRECT ANSWERS✔️✔️gross investment minus depreciation
nominal value - CORRECT ANSWERS✔️✔️value of an economic variable based on
current prices. taking no account of changing prices through time
, absolute advantage - CORRECT ANSWERS✔️✔️a country's ability to produce
good using less resources than another country
aggregate demand (AD) curve - CORRECT ANSWERS✔️✔️the relationship
between the level of aggregate demand and the overall price level, it shows
planned expenditure at any given possible overall price level
appreciation - CORRECT ANSWERS✔️✔️a rise in the exchange rate within a
floating exchange rate system
average propensity to consume - CORRECT ANSWERS✔️✔️the proportion of
income that households devote to consumer expenditure
balance of payments - CORRECT ANSWERS✔️✔️a set of accounts showing the
transactions conducted between residents of a country and the rest of the world
Canons of Taxation - CORRECT ANSWERS✔️✔️four maxims devised by Adam
Smith, setting out the characteristics of good tax
capital account of the balance of payments - CORRECT ANSWERS✔️✔️account
identifying transactions in (physical) capital between the residents of country and
the rest of the world
capital productivity - CORRECT ANSWERS✔️✔️measure of output per unit of
capital
