Macroeconomics condensed Flashcards
AO=AI=AE what are the elements in each?
What is not included in the above?
GDP delfator formula?
GDP formula, expenditure approach and Income approach?
National income formula?
Personal income formula?
Business saving formula?
What is the derived equation for Savings?
explain how changes in Y,r,T affect each component of AE?
Explain the relationships between the wealth, interest rate and real exchange rate effects
What is output Y a function of and explain what causes shifts in AD?
What causes shifts in AS?
What is a recessionary and inflationary gap, what are real GDP growth and long-term GDP growth, what is the investment action in each and policy to change?
How does stagflation occur?
What shifts LRAS?
What is the neo-classical production function?
Growth in potential GDP formula?
What are the sources of growth?
Measures of sustainable growth?
Explain what happens at each of the four stages of the business cycle?
What happens in strong/weak economy with regards to credit?
What happens at each stage of BC with Sales, Inventory/sales, Capital utilisation, capital spending?
What is happening at each stage of the business cycle for Income, consumer confidence, durable/non-durable goods, services?
Explain the relationship between house prices, household income and interest rates
Explain the policy suggestions of Neo-classical, Austrian, Monetarism and keynsianizm? And what each says creates business cycles?
What are lead, lagging and coincident economic indicators?
What is a composite indicator?
Definitions: Employed, labour force, Unemployed, unemployment rate, participation rate, frictional unemployment, underemployed, discouraged worker,Voluntary unemployed?
Productivity formula?
What is inflation, disinflation, deflation and Hyperinflation?
Why is CPI overstated?
What are the laspreyes and paasche indexes?
What is the chained price index?
What is core inflation?
Producer price index?
What is cost-push inflation?
What is demand-pull inflation?
What is the money velocity equation?
And difference in inflation from types of changes in V?
What does FP and MP seek?
Money must have which three properties?
and it must have what characteristics?
M1 and narrow and M2 broad money definitions?
What is the money multiplier formula and the quantity theory of money?
What are three sources of demand for money and their cyclical nature?
What happens when there is excess/shortage of money demand?
What is the fisher effect ?
What is the role of CB’s 6 things?
Objectives of CB’s?
What are the expected vs unexpected costs of inflation?
Explain the policy tools of open market operations, policy rate and reserve requirements?
What are the direct and indirect effects of changing the policy rate?
What are the three qualities a CB needs?
What is a neutral rate?
What are the limitations of MP?
2) Deflation - policy rate has a lower bound of 0%
What are the FP tools and the two types of taxes?
Pros and cons of FP?
What is the fiscal multiplier?
When is high Debt/GDP not an issue?
What effect can higher taxes rates have in future on debt issues?
Summary of effect on AD and r of tight/loose FP/MP?
What is GDP and GNP?
What is the terms of trade?
Closed economy and open economies have what prices?
Who wins and who loses going from closed to open economy?
What are the benefits of trade?
What are the costs of trade?
What is absolute and comparative advantage?
In the ricardian model trade is based on what, what is the only variable factor and what happens with technology across countries?
In the HO model what is trade based on, what factors are variable and technology is what across countries?
What are restrictions on trade?
What are the aim of tarrifs, effect on CS, PS GR and DWL, if large or small country?
What are the aim of quotas, effect on CS, PS GR and DWL, if large or small country?
What is a VER and what happens to DWL?
What is an export subsidy, difference between large and small countries in imposing them?
What are the effects of them?
What is a regional trading bloc?
What defines a customs union, common market, economic union and monetary union?
How does trade diversion occur among members?
How does trade creation occur?
What are the benefits and costs of integration, and the challenges?
What are the positives and negatives from allowing free flow of capital?
Why and how can capital be restricted?
What is the balance of payments and what is recorded in each seperate account (current, capital and financial)?
What does CA +I =?
What is the role of the IMF, World bank and World trade organization?
Exchange rate is quoted as ?/?
What is a direct and indirect quote?
Formula for real exhcnage rate?
What is a spot rate, foward rate, FX-swap, who are the main participants in FX markets? What are major and cross pairs?
How are forward rate calculations done and what are premium and discount in terms of points?
Forward rate equation in terms of interest rates?
Compare fixed and floating ER regim?
Compare restricted and free flowing capital regimes?
What is a no seperate legal tender system and a currency board system?
ER systems: Fixed parity, target zone, active and passive crawling peg, fixed parity with crawling bands, managed float?
Explain the relationship between trade surplus/deficit, capital flows and currency pressure?
What is the marshall lerner condition and what happens to trade surplus in st/lt depending on whether x or m is more elastic?
Intervention will be more effective for trade adjustment if X and M are what?
What is the J-curve and the ST/LT scenarios?
What is geopolitical risk, the actors and the affects?
what are state and non-state actors, features of cooperation and non-cooperation?
What are the motivations for cooperation?
What is globalisation, recent tailwinds, what is nationalism?
Motivations and costs of globalisation? and threats of roll back?
What are the four archtypes and where do they stand on globalisation and cooperation?
Where do key economic and financial tools fit in with regards to globalisation/cooperation?
