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YIELD CURVE: A curve plotting the yields (or returns) on securities with different maturity lengths. The standard yield is for U.S. Treasury securities with lengths ranging from 90 days to 30 years. The five maturity lengths are usually 90 day, 180 day, 2 year, 5 year, 10 year, and 30 year. The shape and slope fo the yield curve indicates the state of the economy and what's likely to come. A normal yield curve has a slight positive slope, with slightly higher yields for longer maturity securities. A steep yield curve suggests the end of a contraction and beginning of an expansion. An inverted, or negatively sloped yield curve is the sign of an upcoming contraction.

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Lesson 9: Macro Basics | Unit 2: Macro Problems Page: 5 of 16

Topic: Unemployment <=PAGE BACK | PAGE NEXT=>

Unemployment exists when resources, specially labor, are willing and able to produce goods but are not employed because no one is buying production.
  • Voluntary unemployment occurs when people choose not to work.
  • Involuntary unemployment occurs when people are willing to work, but can't find employment.
Unemployment problems:
  • The economy suffers because unemployed resources are not producing goods to lessen the scarcity problem.
  • The unemployed suffer personal hardships and a lower living standard.
Production lost from unemployed resources can never be recouped.

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RESOURCES

Labor, capital, land, and entrepreneurship used by society to produce consumer satisfying goods and services. Resources are often given the more descriptive term factors of production.

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Today, you are likely to spend a great deal of time surfing the Internet trying to buy either a computer that can play video games and burn DVDs or a black duffle bag with velcro closures. Be on the lookout for rusty deck screws.
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Approximately three-fourths of the U.S. paper currency in circular contains traces of cocaine.
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