Economics Formula Sheet

Question 1

Economic Growth

Answer 1

EG = [real GDP (current) - real GDP (previous) / real GDP (previous) ] x 100

Question 2

Real GDP

Answer 2

Real GDP = Nominal GDP x 100/CPI

Question 3

Unemployment Rate

Answer 3

unemployment rate = [unemployed/labour force] x 100

Question 4

Participation Rate

Answer 4

Participation rate = [labour force/working age population] x 100

Question 5

Labour Force (LF)

Answer 5

LF = unemployed + employed

Question 6

Working Age Population (WAP)

Answer 6

WAP = those aged 15-64

Question 7

Inflation Rate

Answer 7

[CPI (current) - CPI (previous) / CPI (previous)] x 100

Question 8

Real value

Answer 8

nominal value - inflation

Question 9

Gini coeffecient

Answer 9

A / A + B

Question 10

Terms of Trade (TOT)

Answer 10

[export price / import price] x 100

Question 11

Net foreign liabilities

Answer 11

NFD + NFE

Question 12

Net foreign debt (NFD)

Answer 12

loans owed by Australia - loans owed to Australia

Question 13

Net foreign equity (NFE)

Answer 13

foreign investment into AUS - AUS investment overseas.

Question 14

CAD to GDP ratio

Answer 14

[CAD / GDP] x 100

Question 15

Net foreign liability to GDP ratio

Answer 15

[NFL / GDP] x 100

Question 16

Aggregate demand

Answer 16

AD = C + I + G + (X-M)

Question 17

Aggregate supply

Answer 17

Y = C + S + T

Question 18

At Equilibrium

Answer 18

S + T + M = I + G + X

Question 19

Simple multiplier (K)

Answer 19

K = 1/1-MPC OR 1/MPS

Question 20

MPC

Answer 20

△C / △Y

Question 21

MPS

Answer 21

△S / △Y

Question 22

Balance of Payments (BOP)

Answer 22

CA + KAFTA

Question 23

What is the Current Account (CA) made out of?

Answer 23

Goods + Services + Primary & Secondary Income

Question 24

What is the Capital & Financial Account (KAFTA) made out of?

Answer 24

Foreign aid + direct investment + portfolio investment + financial derivatives + other investments