formulae Flashcards
(13 cards)
What is Aggregate Demand (AD)?
AD = C + I + G + (X - M)
Where: C = Consumer Expenditure, I = Investment, G = Government Spending, X = Exports, M = Imports
What is the formula for Average Rate of Taxation (ART)?
ART = Tax Paid / Income
What is Cross Elasticity of Demand (XED)?
XED = % change in quantity demanded of product A / % change in price of product B
What is the equilibrium income in an open economy?
I + G + X = S + T + M
Where: I = Investment, G = Government Spending, X = Exports, S = Savings, T = Taxation, M = Imports
What is Income Elasticity of Demand (YED)?
YED = % change in quantity demanded / % change in income
What is Marginal Rate of Taxation (MRT)?
MRT = Change in tax paid / Change in income
What is Price Elasticity of Demand (PED)?
PED = % change in quantity demanded / % change in price
What is Price Elasticity of Supply (PES)?
PES = % change in quantity supplied / % change in price
What is Real GDP?
Real GDP = Nominal GDP × (Price Index in Base Year / Price Index in Current Year)
What is the Terms of Trade Index?
Terms of Trade Index = (Index of Export Prices / Index of Import Prices) × 100
What is Total Revenue (TR)?
TR = P × Q
Where: P = Price, Q = Quantity
What is the Unemployment Rate?
Unemployment Rate = (Number of People Unemployed / Labour Force) × 100
