Apple have updated their iMac line up to now have a cheaper model, even if it's still not very affordable. This new iMac features the standard 21.5-inch screen as the previous base model but with some downgraded specs. There is now a 1.4Ghz dual-core Intel Core i5 processor, 8GB of RAM, 500GB hard drive and a Intel HD Graphics 5000 chip.
By no means does that means it's not powerful though. The specs should be more than enough power for most and will easily be able to handle things like Photoshop, but you are better off upgrading if you're into video editing.