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Intermediate Macro Economics > Macro Interim > Flashcards

Macro Interim Flashcards

Basic Understanding of Functions and Vocab

1
Q

National Income Identity (Y = C + I + G + NX)

A

GDP = Consumption + Investment + Government Purchase + (exports-imports)

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2
Q

GDP = Consumption + Investment + Government Purchase + (exports-imports)

A

National Income Identity (Y = C + I + G + NX)

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3
Q

Nominal GDP

A

(price level)(real GDP)

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4
Q

(price level)(real GDP)

A

Nominal GDP

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5
Q

L-Index

A

Computation in Change of Real GDP with initial prices

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6
Q

Computation in Change of Real GDP with initial prices

A

L-Index

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7
Q

P -Index

A

Computation in Change of Real GDP with final prices

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8
Q

Computation in Change of Real GDP with final prices

A

P -Index

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9
Q

Chain Weighting

A

average of L-Index and P-Index

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10
Q

average of L-Index and P-Index

A

Chain Weighting

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11
Q

Growth Rate (percentage change per capita)

A

(Yt+1 - Yt ) / Yt

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12
Q

(Yt+1 - Yt ) / Yt

A

Growth Rate (percentage change per capita)

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13
Q

Level of Per Capital Income

A

Y(t+1) = Yt(1+g)

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14
Q

Y(t+1) = Yt(1+g)

A

Level of Per Capita Income

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15
Q

Constant Growth Rule

A

Yt = Yo(1+g)t

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16
Q

Yt = Yo(1+g)t

A

Constant Growth Rate

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17
Q

Standard Scale when graphed looks like

A

exponential growth

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18
Q

Ratio Scale when graphed looks like

A

a straight line, linear.

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19
Q

Computation of Growth Rate

A

g(constant) = (Yt / Yo)1/t - 1

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20
Q

g(constant) = (Yt / Yo)1/t​ - 1

A

Computing growth rate

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21
Q

Growth rate of ratio: z =x/y

A

gz = gx - gy

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22
Q

gz = gx - gy

A

Growth rate of ratio: z = x/y

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23
Q

Growth rate of ratio: z =(x)(y)

A

gz = gx + gy

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24
Q

gz = gx + gy

A

Growth rate of ratio: z =(x)(y)

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25
Q

Growth rate of ratio: z = xa

A

gz = (a)(gx)

26
Q

gz = (a)(gx)

A

Growth rate of ratio: z = xa

27
Q

Production Function: K = machine; L = workers

A

Y = F(K, L) = A(K1/3)(L2/3)

28
Q

Y = F(K, L) = A(K1/3)(L2/3)

A

Production Function: K= machine; L = workers

29
Q

Paramter

A

Input that is generally fixed over time

30
Q

Input that is generally fixed over time

A

Paramter

31
Q

Exogenous Variable

A

INPUT that is allowed to change over time but determined aheaded of time. (POPULATION)

32
Q

INPUT that is allowed to change over time but determined aheaded of time. (POPULATION)

A

Exogenous Variable

33
Q

Endogenous Variable

A

OUTCOME (determined by supply and demand)

34
Q

OUTCOME (determined by supply and demand)

A

Endogenous Variable

35
Q

Potential Output

A

Measurment of per capita GDP evolvement if prices are completely flexible and resources fully employed

36
Q

Measurment of per capita GDP evolvement if prices are completely flexible and resources fully employed

A

Potential Output

37
Q

Economic Profit

A

Total Revenue minus Total payments for INPUT

38
Q

Total Revenue minus Total payments for INPUT

A

Economic Profit

39
Q

Accounting Profit

A

Revenue minus Payment to labor

40
Q

Revenue minus Payment to labor

A

Accounting Profit

41
Q

output per person in equilibrium

A

y*= (A-bar)(K1/3)

42
Q

y*=(A-bar)(K1/3)

A

output per person in equilibrium

43
Q

(A-bar)

A

Productivity Parameter (Total Factor of Production/Residual)

44
Q

Productivity Parameter (Total Factor of Production/Residual)

A

(A-bar)

45
Q

Law of Diminishing Return

A

All inputs held constant and 1 input increases and tend to a large number, increasing of output diminishes

46
Q

All inputs held constant and 1 input increases and tend to a large number, increasing of output diminishes

A

Law of Diminishing Return

47
Q

Human Capital

A

Stock or skills that individuals accumulate to make them more productive

48
Q

Stock or skills that individuals accumulate to make them more productive

A

Human Capital

49
Q

Solow Growth Model

A

Turning exogenous variables into endogenous variables, where capital is accumulated over time

50
Q

Turning exogenous variables into endogenous variables, where capital is accumulated over time

A

Solow Growth Model

51
Q

Capital Accumulation

A

Kt+1 = Kt + It - (d-bar)Kt

Inital Capital(t) + investment used for production(t) -depreciation

52
Q

Kt+1 = Kt + It - (d-bar)Kt

Inital Capital(t) + investment used for production(t) -depreciation

A

Capital Accumulation

53
Q

Steady-State level of Capital

A

y* = ((s-bar)(A-bar) / (d-bar))3/2 (L-bar)

54
Q

y* = ((s-bar)(A-bar) / (d-bar))3/2 (L-bar)

A

Steady-State level of Capital

55
Q

Steady-State level of Production

A

y* = (A-bar)3/2(s-bar/d-bar)1/2​ (L-bar)

56
Q

y* = (A-bar)3/2(s-bar/d-bar)1/2 (L-bar)

A

Steady-State level of Production

57
Q

Investment Equation

A

(Share of Output for investment) - (weighting diff of real interest and MPK)(MPK)

58
Q

(Share of Output for investment) - (weighting diff of real interest and MPK)(MPK)

A

Investment Equation

59
Q

Nominal

A

Valued at Current Price

60
Q

Valued at Current Price

A

Nominal

61
Q
A

Intermediate Macro Economics (3 decks)

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