Crisis Mode
This occurs when the economy is producing at less than its potential output.
What is a recessionary gap?
This Micro curve hits its minimum when marginal cost intersects it from below
What is the average total cost (ATC) curve?
The student union acts as one of these because there is no competition and high barriers to entry.
What is a monopoly?
This occurs when the quantity supplied of a good or service exceeds the quantity demanded at the prevailing market price.
What is a surplus?
When a country imposes a tariff on imported goods, this is the effect it has on domestic prices.
What is an increase in domestic prices?
During a recession, the government can use this fiscal policy tool to increase economic activity.
What is increasing government spending?
This curve is a downward-sloping beauty that lets you pick between inflation and unemployment.
What is the short-run Phillips Curve?
This type of firm earns zero economic profit in the long run and is completely forgettable in the market, sort of like me at prom.
What is a perfectly competitive firm?
This is the term for a situation in which an economy experiences high inflation and high unemployment at the same time.
What is Stagflation
This economic concept describes the ability of a country to produce a good at a lower opportunity cost than another country.
What is comparative advantage?
When an ample reserve market is overheating, the central bank may use this tool to decrease the money supply.
What is raising IOR?
On the graph of the loanable funds market, if inflation expectations increase, this curve shifts left.
What is the supply of loanable funds?
This curve in Macro is vertical in the long run because wages and prices are flexible, unlike your schedule during AP season.
What is the long-run aggregate supply curve?
This term describes a situation where resources are allocated in such a way that no one can be made better off without making someone else worse off.
What is socially optimal?
When a country has a higher export value than import value, it is said to have this type of balance in its trade.
What is a trade surplus?
If the government borrows to fund increased public spending during a recession, what happens to long-term capital investment?
What is lower capital investment?
This curve seems to make the shape of a banana, and the bigger the area inside the banana, the more inequality there is.
What is the Lorenz curve
The clothes at the Spirit Store are examples of this type of good.
What is a private good?
What curve on the AD/AS model shifts during a recession to return equilibrium to the long run, if the government doesn’t get involved
What is SRAS?
When a country imposes a tax on imports to protect domestic industries, it is using what kind of trade policy tool?
What is a tariff?
When unemployment is high during a recession, this type of unemployment increases due to a slowdown in economic activity.
What is cyclical unemployment?
This curve is not traditionally shown on the perfect competition firm graph for AP Micro.
What is the average fixed cost (AFC) curve?
In the short run, firms can earn economic profit or losses. But this feature of perfectly competitive markets ensures it won’t last, just like your optimism during FRQs.
What is free entry and exit?
These financial instruments, including stocks and bonds, are traded in financial markets and can be used by governments and corporations to raise capital.
What are securities?
When a government implements a tariff, the resulting price increase typically leads to an effect on consumer surplus and producer surplus.
Consumer surplus decreases, and producer surplus increases.