Item 8 Review List of Terms - Economics Vocabulary

8/2/2019 Item 8 Review List of Terms - Economics Vocabulary

1/5

AP Macroeconomics: Review Terms

I. Basic Economic Concepts ----------

macroeconomics

microeconomics

scarcity

tradeoffs/opportunity cost

aggregateceteris paribus

independent variable

dependent variable

utility

marginal utility

land, labor, capital, entrepreneurship

full employment

allocative efficiency

capital goods

consumer goods

production possibilities curve/frontier

law of increasing opportunity costs

circular flow modelresource market

product market

comparative advantage of trade

absolute advantage of trade

law of demand

law of supply

demand versus quantity demanded

diminishing marginal utility

supply versus quantity supplied

elastic, inelastic

equilibrium prices and quantities

rationing function of prices

ceilings

floors

substitute goods

complementary goods

normal profit

economic profit

sole proprietorship

partnership

corporation

limited liability

transfer payments

natural monopoly

transfers/transfer paymentsspillovers (costs, benefits)

subsidy

marginal tax rate

excise tax

normal growth/secular trend

expansion

contraction

peak


2/5

trough

II. Measurement of Economic Performance ----------

gross domestic product (GDP)

gross national product (GNP)

multiple counting

C + Ig + G + XnW + R + I + P + SA

depreciation/CFC

net investment

stock of capital

net domestic product (NDP)

indirect business taxes

net foreign factor income

national income (NI)

personal income (PI)

disposable income (DI)

consumption

savings

GDP price indexnominal versus real

CPI

basket of goods

GDP deflator

per capita

rule of 70/rule of 72

productivity

rate of growth

actual versus potential GDP

GDP gap

demand pull inflation

cost push inflation

rate of inflation

labor force

employed

unemployed

discouraged

natural rate of unemployment

Okun's law

COLA's

anticipated inflation

hyperinflation

frictional unemployment

structural unemployment

cyclical unemploymentseasonal unemployment


3/5

III. National Income and Price

Determination:

----------

aggregate demand

aggregate supply

consumption schedule

saving scheduleAPC

APS

MPC

MPS

saving range

dissaving range

investment demand

expected rate of return

nominal interest rate

real interest rate

multiplier effect (1/1-MPC)

real domestic output (GDPr)

determinants of aggregate demand (the list)determinants of aggregate supply (the list)

wealth effect

liquidity wealth

government multiplier

crowding out effect

per unit production costs

LRAS

SRAS

Say's Law

Keynesian Fiscal Policy

Fed Monetary Policy

the ratchet

sticky wages

nondiscretionary spending

discretionary spending

stabilizers

leaks

injections

budget deficit

budget debt

balanced budget multiplier

expansionary fiscal policy

contractionary fiscal policy

progressive tax systems

full employment budgetsupply side policies


4/5

IV. Financial Sector ----------

M-1, M-2, M-3

stocks

bonds

transactional demandasset demand

money market

loanable funds market

bond market

Federal Board System

Board of Governors

FDIC

OMC (FOMC)

Beige Book

open market operations

future values of money

fed fund rate

discount rateprime rate

required reserves

excess reserves

reserve multiplier (monetary multiplier)

liquidity

easy money policies

tight money policies

velocity of money

net export effect

fiscal versus monetary: cause and effect

V. Inflation, Unemployment, and Stabilization

Policies

Phillips Curve SR

Phillips Curve LR

stagflation

disinflation effects

Laffer Curve relations

annually balanced budget

cyclically balanced budget

crowding out effect

MV = PQ

VI. Economic Growth and Productivity ----------

human capital

physical capitalgrowth policy options


5/5

VII. Open Economy: International Trade

and Finance

----------

gold standard

Bretton Woods system

WTO

IMFNAFTA

CAFTA (DR-CAFTA)

EU

absolute advantage

comparative advantage

terms of trade

"capital inflow"

"capital outflow"

output efficiency

input efficiency

trade barriers

tariffs

non-tariff barriersprice dumping

balance of payments

current account

capital account

trade surplus

trade deficit

official reserves

currency appreciation

currency depreciation

official reserves

fixed exchange rates

floating exchange rates

net exports

dollarization

remittances

purchasing power parity of currencies

multinational corporations

joint ventures

executive agreements

congressional-executive agreements

most favored nations (normal trade relations)

ad-valorem tariff

Documents

Item 8 Review List of Terms - Economics Vocabulary