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BEC > Economics > Flashcards

Economics Flashcards

1
Q

Nominal GDP vs. Real GDP

A

No inflation adjusted; inflation adjusted (use GDP deflator)

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2
Q

Real Calculation

A

Nominal GDP/GDP Deflator *100

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3
Q

Business Cycles

A

Expansionary, Peak, Contractionary, Trough, Recovery

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4
Q

Expansionary Phase

A

Rising economic activity
Firm profits rising
Increased workforce

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5
Q

Peak Phase

A

Capacity constraints

Highest profits

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6
Q

Contractionary Phase

A

Firm profits falling

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7
Q

Trough Phase

A

Lowest firm profits

Excess capacity

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8
Q

Reduction in Aggregate Demand

A

ADv GDPv Pv

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9
Q

Increase in Aggregate Demand

A

AD^ GDP^ P^

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10
Q

Reduction of Supply

A

SRASv GDPv P^

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11
Q

Increase of Supply

A

SRAS^ GDP^ Pv

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12
Q

Increase in Wealth

A

W^ Spend ^ AD ^ GDP^ P^

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13
Q

Increase in Rates

A

I^ Borrowv Spendv ADv GDPv Pv

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14
Q

Economic Outlook

A

Outlook^ Spend^ AD^ GDP^ P^

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15
Q

Appreciated Currencies

A

Currency^Exportsv Imports^ ADv GDPv Pv

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16
Q

Increase Govt Spend

A

Govt Spend^AD^GDP^P^

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17
Q

Increase Consumer Taxes

A

Taxes^SpendvADvGDPv Pv

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18
Q

Expenditure Approach-GDP

A

Govt purchasas
Iinvestment, private
Consumption, personal
Exports,net

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19
Q

Income Approach-GDP

A 
Income of proprietors
Profits of corp
Interest
Rental Income
Adjustments for foreign income
Taxes
Employee wages
Depreciation
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20
Q

Unemployment Rate Calculation

A

Number of unemployed/Total labor force *100

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21
Q

What is frictional unemployment?

A

Result from workers routinely changing jobs

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22
Q

What is structural unemployment?

A

Jobs available do not correpsond to to skills of workforce

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23
Q

Consumer Price Calculation

A

(CPIcurrent-CPIprevious)/CPI previous *100

24
Q

What is nominal int rate?

A

Rate in current dollars

25
Q

Real Int Rate Calculation

A

Nominal-inflation

26
Q

What is M1

A

coin, currency, check deposits

27
Q

What is M2

A

M1+CD’s<100k

28
Q

What is M3

A

M2+CD’s>100k

29
Q

Increase in Money Supply

A

Expansaionary

Increase^ Spend^ AD^ GDP^P^

30
Q

Raise discount rate

A

Contractionary

Increase^ BorrowV Spendv ADv GDPv Pv

31
Q

Raise reserve requirements

A

Contractionary

Increase^ Spendv ADv GDPv Pv

32
Q

Change in Quantity Demanded (price first)

A

P^ Dv or PvD^

33
Q

Change in Demand (demand first)

A

D^P^

34
Q

Factors that shift demand cruve

A 
Wealth
Relared goods
Income, consumer
Tastes
Expectations
Nunmbers of buyers
35
Q

Change in Quantity Supplied (price first)

A

P^ S^

36
Q

Change in Supply

A

S^ Pv

37
Q

Factors that shift supply

A 
Exepctations, price
Costs, production
Other goods change in price/demand
Subsidies, taxes
Technology, production
38
Q

Price Elasticity of Demand

A

%change in Qd/%change in P

Elasticity1=Elastic

39
Q

Pure Competition

A

Very Competitie
No barrier to entry
Large number of suppliers/no product differentiation
Price takers

40
Q

Monopoly

A

Price Setter
Significant barriers
Least competitive
No substitute products

41
Q

Monopolistic

A

Numerours firms with differentiated products
Few barriers
Significant non price competition

42
Q

Oligopoly

A

Significant barriers

Few differentiated products

43
Q

Porters 5 Forces

A 
Barriers to Entry
Market Competitivness
Substitute Products
Bargpaining power of customer
Bargaining Power of Buyer
44
Q

Equilibruinr

A

Qd=Qs

45
Q

GDP

A

All goods and services produced domestically

Foreign COmpany in US

46
Q

GNP

A

US overseas production included

47
Q

Disposable Income

A

Personal-Taxes

48
Q

Tariff

A

Tax on imported goods

49
Q

Quota

A

Limit on number of imported goods

50
Q

What is political business theory?

A

Economy heading in right direction as election approaches

51
Q

What is discount rate?

A

Rate central bank charkes for loans to other banks

52
Q

3 Tools to affect monetary policy

A
  1. Inc/dec money supply
  2. Change interest rate
  3. Change reserves
53
Q

MPS

A

1-MPC

54
Q

Call/Put

A

Call=buy

put=sell

55
Q

MPC

A

Change in consumption/change in income

56
Q

Call Option

Put Option

A

Call-expect price to increase

Put-expect price to decrease

BEC (11 decks)

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