Formula Flashcards
Real GDP
(Nominal GDP / Price Index) × 100
Real GDP per Capita
(((Nominal GDP / Price Index) × 100) / Population) × 100
Index Number
(Raw Number / Base Year Raw Number) × 100
Weighted Price Index
- Convert Prices into Index Form
- Multiply Index Numbers by Weight
- Add up all Weighted Prices
- Divide by Total Number of Weights
Bond Yield
Yield = Coupon / Market Price × 100
Total Cost
Total Fixed Cost + Total Variable Cost
OR
Average Cost × Quantity
Total Fixed Cost
Total Cost - Total Variable Cost
OR
Average Fixed Cost × Quantity
Total Variable Cost
Total Cost - Total Fixed Cost
OR
Average Variable Cost × Quantity
Average Cost
Total Cost / Quantity
OR
Average Fixed Cost + Average Variable Cost
Marginal Cost
Change in Total Cost / Change in Quantity
Average Product
Total Product / Quantity of Labour
Marginal Product
Change in Total Product / Change in Quantity of Labour
Total Revenue
Price × Quantity
Average Revenue
Total Revenue / Quantity = Price
Marginal Revenue
Change in Total Revenue / Change in Quantity
Profit
Total Revenue - Total Cost
Supernormal Profit
Average Revenue > Average Cost
Subnormal Profit
Average Revenue < Average Cost
Profit Max
Marginal Revenue = Marginal Cost
Revenue Max
Marginal Revenue = 0
Average Cost = Average Revenue
Normal Profit
Sales Max
Breakeven
Entry Limit Price
Allocative Efficiency
Demand = Supply
Marginal Social Benefit = Marginal Social Cost
Price = Marginal Cost
Productive Efficiency
Minimum point on Average Cost
Average Cost = Marginal Cost
X Efficiency
At any point on Average Cost
Dynamic Efficiency
Long Run Supernormal Profit
Minimum Efficient Scale
At the lowest quantity level when Average Cost stops decreasing
Shutdown Condition
Average Revenue = Average Variable Cost
Average Revenue < Average Variable Cost
Average Utility
Total Utility / Quantity
Marginal Utility
Change in Total Utility / Change in Quantity
Utility Max
Marginal Utility = 0
Social Cost
Private Cost + External Cost
Social Benefit
Private Benefit + External Benefit
Profit Max (Labour Market)
Marginal Revenue Product = Marginal Cost of Labour
Price Elasticity of Demand
% Change in Quantity Demanded / % Change in Price
Price Elasticity of Supply
% Change in Quantity Supplied / % Change in Price
Cross Elasticity of Demand
% Change in Quantity Demand of Good X / % Change in Price of Good Y
Income Elasticity of Demand
% Change in Quantity Demanded / % Change in Income
GDP
Value of all Goods and Services produced in an economy in a year
Sum of all Factor Incomes
Aggregate Demand: C + I + G + (X - M)
Nominal GDP
Quantity × Current Prices
GDP Deflator
(Nominal GDP / Real GDP) × 100
GNI
GDP + Net Factor Income
Green GDP
GDP - Environmental Costs
Aggregate Demand
C + I + G + (X - M)
Multiplier
1 / 1 - Marginal Propensity to Consume
1 / Marginal Propensity to Withdraw
Marginal Propensity to Withdraw
Marginal Propensity to Save + Marginal Propensity to Import + Marginal Propensity to Tax
Unemployment Rate
Unemployed / Labour Force
% Change
(Difference / Original) × 100
Marshall-Lerner Condition
PED(Exports) + PED(Imports) > 1
Terms of Trade
(Average Index Price of Exports / Average Index Price of Imports) × 100
Taxable Income
Total Income - Tax Free Allowance
Constant Returns to Scale
% Change in Output = % Change in Input
Increasing Returns to Scale
% Change in Output > % Change in Input
Decreasing Returns to Scale
% Change in Output < % Change in Input
