Exam 2 Study Guide

Economics 104 with Staihr at University of Kansas

About this deck

By: Ryan Libel
Textbook:

Microeconomics (2nd Edition) (MyEconLab Series)(Book only)
Created: 2011-11-07
Size: 26 flashcards
Views: 12

About StudyBlue

STUDYBLUE makes things that make you better at school. Things like online flashcards with photos and audio. Things like personalized quizzes and friendly reminders about when (and what) to study next. Think of it as a digital backpack™: access to all of your study materials online and on your phone. STUDYBLUE exists to make studying efficient and effective for every student, for free. Join us.

“I have used this website for three exams, and I see a huge difference in my test results.”
Naj

Sign up (free) to study this.

1983

Base year for Consumer Price Index (CPI)

Inflation

The Continual rise in the price level; Erodes the value of savings

Hyperinflation

When inflation hits triple digits; over 100%

Investment

Companies buying stuff: (capital); Purchasing capital and Undertaking Investment are the same thing

Supply of Loanable Funds

The money being borrowed

1998-2001

The only years since 1970 in which US has had a surplus; due to a tax increase

Reduce the supply of Loanable Funds

What happens when you loan the government money

Peak

The beginning of recession when GDP stops growing, and possibly decreasing, and prices and unemployment are decreasing

Unemployment

Lags in the Business Cycle; Making recent recession seem bad right now

Positive Shock

Type of sunspot or shock; Ex: Information technology revolution, increase in GDP

Expansion

Where US currently is in Business Cycle even though it doesn't always seem like it

GDP Growth

Caused by Labor, technology, natural resources, and human capital

Short Run

What we do produce at any time (Always goes up); Tells which side of line AS is; Can be on either side of vertical line causing a third shift

Aggregate Demand

Changes in Consumer Expectations or Government Policies

Shifts Left

Direction AD shifts when everyone feels like they are going to lose their jobs so they are spending less

Shifts Right

Direction AD shifts when everyone feels like everything is going good and spends more money

Oil

We sometimes have no control of SRAS; almost always has to do with this

Policy Decisions

Deciding what to do when our economy is in a less than optimal place

Recessionary Gap

Is somewhere below full employment output; Costs and wages decrease during this because there is a surplus of factors of productions

Slopes Down

The Wealth Effect, International Trade Effect, and Interest Rate Effect all cause Aggregate Demand (AD) to do this

Slope Right

Direction AD shifts when Government spending goes up

Money

Assets that people are generally willing to accept in exchange for goods and services or for payments of debts

Asset

Anything of value owned by a person or firm

Double Coincidence of Want

Money eliminates the need for this

Medium of Exchange

When sellers are willing to accept something in exchange for goods or services

Unit of Account

A way of measuring the value in the economy in terms of money

About this deck

By: Ryan Libel
Textbook:

Essentials of Economics

Microeconomics (2nd Edition) (MyEconLab Series)(Book only)
Created: 2011-11-07
Size: 26 flashcards
Views: 12

About StudyBlue

“I have used this website for three exams, and I see a huge difference in my test results.”
Naj