Macro Final Exam

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Macro Final Exam by Mind Map: Macro Final Exam

1. GDP

1.1. nominal

1.1.1. (Pcurrent) (Qcurrent)

1.2. real

1.2.1. (Pbase) (Qcurrent)

1.3. Ways to calculate

1.3.1. income compensation interest rent profit

1.3.2. expenditure

1.4. Expenditure approach ( 4 keys components)

1.4.1. Personal expenditure / Consumption

1.4.1.1. 3 types of consumption

1.4.1.1.1. durable, non durable, services

1.4.2. Gross Private Domestic Investment Ig

1.4.2.1. 3 types of Ig

1.4.2.1.1. Residental Non residental Inventory

1.4.3. Government Spending

1.4.3.1. G is autonomous ( not influence by any factors)

1.4.3.2. except transfer payment, medicare, social security, medicaid,etc

1.4.4. International = net export (X-M)

1.4.4.1. exchange rate

1.4.4.2. positive/negative relationship between GDPus, GDPf and $ value

1.5. GNP = gross national income ( GDP + net income from aboard

1.5.1. NNY- net national income ( GNP - Depreciation )

1.6. Exclusion of GDP

1.6.1. transfer payments

1.6.1.1. underground economy ( 2% of US GDP )

1.6.2. financial transactions

1.6.2.1. second hand goods

1.7. GDP gap -full employment - real gdp

1.8. Net investment = Gross Investment - Depreciation

1.9. Income approach

1.9.1. Total National Income + Sales Taxes + Depreciation + Net Foreign Factor Income.

1.9.1.1. Total national income = wages+ rents+ interest + profits.

2. Monetary Policy

2.1. Tools

2.1.1. OMO

2.1.1.1. FFR

2.1.1.1.1. RRR

2.1.2. FOMC

2.2. The Fed 1913

2.2.1. 7 boards governors 12 presidents / districts ( 5 yrs term) head quarter Washington DC

2.3. FDIC - federal deposit insurance corporation 1933

2.4. Expansionary MP

2.4.1. excess supply

2.4.1.1. ppl buy securities

2.4.1.1.1. Pb incresae -> i decrease

2.5. Contractionary MP

2.5.1. Excess demand

2.5.1.1. ppl sell securities

2.5.1.1.1. Pb decrease=> i increase

3. Fiscal Policy

3.1. IOU - Treasury department

3.1.1. 3 types bonds, treasury notes or t-bills

3.2. C - Autonomous/induced consumption

3.3. The federal budget

3.3.1. discretionary (necessary)

3.3.1.1. social security, medicare

3.3.2. mandatory (no choice)

3.3.2.1. defense, education, transportation

3.4. fiscal year - begins Oct 1 and ends on Sep 30

3.4.1. outlays - $ that gov spends in a given fiscal year

4. Money

4.1. medium of exchange unit of measure store of value

4.1.1. why hold money?

4.1.1.1. transactions speculative precautionary

4.2. fiat money/ commodity money

4.3. M1 M2 M3

4.4. Money market equilibirum

5. Inflation

5.1. Market basket

5.1.1. CPI = Cost of MB given year/ cost of MB base year x 100

5.2. Types

5.2.1. Demand Pull/ Cost push

5.2.2. Deflation, Disinflation, Stagflation

5.3. CPI current - CPI base / CPI base x 100 ( rate of inflation)

6. Unemployment

6.1. LF = E+U

6.2. Types

6.2.1. Frictional

6.2.1.1. always exists, between jobs, quit but not fired

6.2.2. Seasonal

6.2.3. Structural

6.2.3.1. mismatch w demand

6.2.4. Cyclical

6.2.5. Discouraged Workers

7. General Economics

7.1. trough, recovery, peak

7.2. factors of production - land labor capital entrepreneurship

8. AS/AD

8.1. MPS/MPC M APS APC

8.2. S<0= dissaved

8.3. DI - C+S

8.4. APS = S/DI

8.5. TM = 1-M or -MPC/MPS

8.6. change in Y = M x change in I

8.7. Economic prosperity

8.7.1. unplanned inventory depletion ( below) unplanned inventory accumulation (above)

8.8. The Keynesian Range

8.8.1. Classical range

8.8.1.1. Intermediate range

8.9. negative slope of AD- real wealth effect, the interest rate effect, the net export effect