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What is the MPS?

MPS is the marginal propensity to save when disposable income has been increased by a $1

- $200

What Shifts PPC?

Resources, technology and trade

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What Is not included in GDP?

Intermediate, nonproduct transactions and illegal activities

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What Are the four Factors of Production?

Land, Labor, Entrepreneurship and capital are the four factors of production

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What Is absolute advantage?

When a country has the advantage of producing the same goods and services than another country

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Who owns the resources to produce and sell to the market?

The federal government

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What is nominal GDP?

GDP not adjusted for inflation

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What Is scarcity?

When there are unlimited wants but limited resources to satisfy the demand of society

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What Are the shifters of demand?

Preferences, price of related goods, income and future expectations

- $500What Makes up GDP

Consumer spending, investments, government spending, and net exports

- $100What Is MPC?

MPC is marginal propensity to consume. When consumption increases after disposable income has been increased by a $1

- $200

What Are the shifters of PPC?

It recognizes public records, acts and judicial proceedings

- $300

What Is seasonal unemployment?

People unemployed due to seasonal job market changes

- $400What Is Consumer Price Index?

CPI is the index of the average goods and services purchased by the typical consumer

- $500What Is frictional unemployment?

People who are unemployed due to the time they used to find a job

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What Is nominal interest rate?

Interest rate actually paid for a loan

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What Measures the cost of purchasing a given market basket

in a given year?

The price index

- $300What Is the circular flow model?

Model which illustrates the flow of goods and services through the economy

- $400What are substitute goods?http:w.sausd.us/Page/25788

Goods that are in demand due to the increase of price of a preferred good

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What Are complimentary goods.

The rise of the price of one good leads to a decrease in the price of another good

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What Is Comparative Advantage?

A country being able to produce goods at a lower opportunity cost than another country.

- $200What Is normative economics?

Normative economics are opinions on how the economy should work

- $300What Is the law of supply?

The higher the price of a good leads to a higher supply of that same good

- $400

What Is the percentage rate of senators that get reelected?

80 percent of senators get reelected

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What Is the law of demand?

The higher the price of one good, the higher the demand of a related good

- $100How Do we measure the

Standard of living?

We measure the standard of living through Real GDP

- 200

What Is the difference between Real GDP and Nominal GDP?

Real GDP is based on average prices and nominal GDP is based on current good prices

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What is the effect of inflation?

It will decrease the amount of goods and services being purchased

- $400Who Counts as part of the labor

force?

People above 16 years old not involved in any full time institutions like school and are willing to work are part of the work force

- $500What Are the 3 causes of

inflation?

Cost push

Demand pull

Excess of printed money