AP Macroeconomics

GDP

100

The monetary value of all goods and services produced in a country in a year

What is Gross Domestic Product? 

200

C+I+G+(X-M)

What is the formula for GDP? 

300

The value of final goods and services evaluated at current-year prices.

What is Nominal GDP? 

400

What does the (X- M) stand for in GDP calculation formula

What are Net Exports

500

Spending by firms on new factories, office buildings, machinery, and additions to inventories, plus spending on households and firms on new houses.

What are Investments? 

Unemployment

100

number of employed + number of unemployed

What is the labor force? 

200

((number of unemployed) / (labour force))* 100

What is Unemployment Rate? 

300

unemployment that results because it takes time for workers to search for the jobs that best suit their tastes and skills

What is Frictional Unemployment? 

400

Long-Lasting Unemployment as a result of shifts in the economy. 

What is Structural Unemployment?

500

What does this formula tell us:  Labor Force / Working Age Population (not institutionalized) 

Labor Force Participation Rate

Inflation

100

A general and progressive increase in the average price level of the economy

What is Inflation? 

200

A contraction of economic activity results in a decline in prices

What is Deflation? 

300

Calculate the inflation rate if prices went from $5 to $6.25 in a year

What is 25%  

400

Shows changes in the average prices of goods and services purchased by consumers over a period of time

What is Consumer Price Index (CPI)? 

500

The decline in the rate of inflation 

What is Disinflation? 

Real vs. Nominal

100

When inflation is being factored into calculations, the result is stated as being _____ 

What is a real?  

200

What is the formula to calculate the GDP Deflator?

What is Nominal GDP / Real GDP x 100? 

300

What is the GDP Deflator in the base year? 

What is 100?

400

What is the Real GDP if the deflator is 125 and Nominal GDP is $8,000? 

What is $6,400? 

500

Calculate the Nominal GDP if Real was $5,000 and the deflator was 110. 

What is $5,500?  

Business Cycle

100

What does the straight line represent in the Business cycle model? 

What is full employment? 

200

What is it called when the business cycle expansion is above the full employment line? 

What is an inflationary gap?  

300

A long-term, often lasting years, economic state characterized by high unemployment and low prices and low levels of trade and investment.

What is a Depression? 

400

Fluctuations in the growth of real GDP, consisting of alternating periods of expansions and contractions.

What is Business Cycle? 

500

A period of economic growth as measured by a rise in real GDP.

What is Expansion?