Economic

Question 1

What are factors that shift AD ?

Answer 1

TWICE Government

T - Taxes
W - Wealth
I - Interest Rates
C - Consumer confidence
E - Exchange rates
G - Government Spending

Question 2

Multiplier fomular?

Answer 2

Multiplier = 1 / (1-MPC)

MPC : Marginal propensity to consume

MCP + MPS = 1

Change in real GDP = Multiplier x Change in spending

Question 3

Measuring GDP - Expenditure approach

Answer 3

GICE - flow-of-products approach

G - Government purchase of good and services
I - Gross private domestic Investment
C - Personal Consumption expenditures
E- Net Export (Export - Import) or minus net Import
__________________________________________
= Aggregated Expenditures.

Question 4

Measuring GDP - Income Approach

Answer 4

I PIRATED - flow of earning & cost approach

I- Income of proprietors
P - Profits of corp
I - Interest (net) 
R- Rental income
A- Adjustment for net foreign income and Misc item
T - Taxes 
D- Depreciation
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
= Domestic Income

Question 5

In a long run, firms in a monopolistically competitive markets will …

Answer 5

Earn zero economic profit