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4. Glossary
Base Year
The year for which prices are used for expressing and weighting
data at constant prices, currently 1995 for GDP.
Constant prices
A series expressing value in terms of the prices of a single year,
removing the effects of inflation
Current prices
Prices not expressed in terms of the base year i.e. in today's terms.
GDP (Gross Domestic Product)
A measure of the economic activity taking place in UK economic territory.
Measured by the ONS, GDP is equivalent to the value added to the economy
by this activity.
GDP Deflator
Measure of domestically generated inflation
Index numbers
This is a time series which shows how figures compare by using ratios.
One year is chosen as the reference year and scaled to 100. All other
figures are scaled so that the ratio of the index number to 100 is
the same as the ratio of that original value to the value in the reference
year.
Inflation
The movement of prices over time. (Strictly speaking, inflation is
the increase in prices, a decrease in price being termed deflation.)
National Accounts
A set of statistics measuring the performance of the various sectors
of the economy.
ONS
The Office for National Statistics, responsible for measuring
all aspects of the National Accounts
Real terms
Figures that have been adjusted for changes in the purchasing power
of money.
Reference year
The year against which price movements are compared, usually expressed
as 100 for index series.
RPI
Retail Prices Index. The RPI is defined as an average measure of change
in the prices of goods and services bought for the purpose of consumption
by the vast majority of households in the UK. RPIX is a similar
measure but with the effects of motgage interest payments removed.
Time series
A set of figures showing the magnitude of a given variable at regular
points in time.
Value Added
The balance on the production account. Defined as output less intermediate
costs.
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Last Updated June 22, 1999 by Russell
Coleman
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