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econ > formulae > Flashcards

formulae Flashcards

1
Q

what’re the leakages in the circular flow

A

STM
Savings (S)
Taxation (T)
Imports (M)

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2
Q

what’re injections into the circular flow

A

IGX
Investment (I)
Government spending (G)
foreign Exports (X)

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3
Q

what happens when I+ G+ X > S+ T+ M

A

+ growth

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4
Q

what happens when I+ G+ X < S+ T+ M

A
  • growth
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5
Q

what happens when I+ G+ X = S+ T+ M

A

macroeconomic equilibrium

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6
Q

what is the formula for AD

A

C+ I+ G+ (X-M)
Consumption
Investment
Government spending
Exports
Imports

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7
Q

what is the multiplier effect formula (M)?

A

M = 1 / (1 - MPC)

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8
Q

what is the (fiscal) budget deficit formula

A

G > T in a year
Government spending
Taxation

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9
Q

what is the fiscal budget surplus formula

A

T > G in a year
Taxation
Government spending

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10
Q

what is the formula for average costs (AC)

A

AC = TC / Q

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11
Q

what is the PED formula

A

%D in QD / %D in P
D = delta (change)
QD = quantity demanded
P = price
(always -)

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12
Q

what is the YED formula

A

%D QD / %D INCOME
(+ for normal goods, - for inferior goods)

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13
Q

what is the XED formula

A

%D QD of Good A / %D P of good B
(+ for substitutes, - for complements)

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14
Q

what is the PES formula

A

%D QS / %D P
(always +)

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15
Q

what is the AC formula (aka ATC)

A

TC \ Quantity Produced

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16
Q

what is the AR formula

A

TR / Quantity Sold

17
Q

where is productive efficiency

A

MC=AC

18
Q

what is profit maximisation

A

MC = MR

19
Q

what is revenue maximisation

A

MR = 0

20
Q

what is normal profit

A

TC = TR

21
Q

what is TC

A

TVC + TFC

22
Q

what is TR

A

Price x Quantity Sold

23
Q

what is the GNI formula

A

GDP + net factor income (any income earned by domestic factors of production abroad - any income earned by foreign factors produced domestically)

24
Q

what is the formula for unemployment rate

A

unemployed / size of labour force x100

25
Q

what is taxable income

A

income - tax free allowance

26
Q

what is the gini coefficient formula

A

the area between the line of perfect equality and the lorenz curve / total area beneath line of perfect equality

27
Q

what is absolute poverty

A

<$2.15 a day

28
Q

what is relative poverty

A

<60% of the median income

29
Q

what is the marshall lerner condition

A

PED (x) + PED (m) > 1

30
Q

what is terms of trade formula

A

(index of export prices / index of import prices) x 100

31
Q

how do HDI scores work

A

0.8 and above - very high
0.7-0.79 - high
0.55-0.69 - medium
<0.55 - low

32
Q

how are bond yields calculated

A

coupon / market price x 100

33
Q

what is liquidity ratio

A

current assets / current liabilities x100

34
Q

what is capital ratio

A

capital / loans x 100

35
Q

what is the terms of trade formula

A

ToT = weighted average of export prices / weighted average of import prices X 100
calculated as an index

econ (10 decks)

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