Transcript Opening Splash

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What is the MPS?
MPS is the marginal propensity to
save when disposable income has
been increased by a $1
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What Shifts PPC?
Resources, technology and trade
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What Is not included in GDP?
Intermediate, nonproduct transactions and illegal
activities
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What Are the four Factors of
Production?
Land, Labor, Entrepreneurship and capital are the
four factors of production
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What Is absolute advantage?
When a country has the advantage of
producing the same goods and services than
another country
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Who owns the resources to
produce and sell to the market?
The federal government
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What is nominal GDP?
GDP not adjusted for
inflation
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What Is scarcity?
When there are unlimited wants but limited resources
to satisfy the demand of society
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What Are the shifters of demand?
Preferences, price of related goods, income and
future expectations
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What Makes up GDP
Consumer spending, investments, government
spending, and net exports
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What Is MPC?
MPC is marginal propensity to consume. When
consumption increases after disposable income has
been increased by a $1
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What Are the shifters of PPC?
It recognizes public records, acts
and judicial proceedings
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What Is seasonal unemployment?
People unemployed due to
seasonal job market changes
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What Is Consumer Price Index?
CPI is the index of the average goods and services
purchased by the typical consumer
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What Is frictional
unemployment?
People who are unemployed due to the time they used to
find a job
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What Is nominal interest rate?
Interest rate actually paid for a loan
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What Measures the cost of
purchasing a given market basket
in a given year?
The price index
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What Is the circular flow model?
Model which illustrates the flow of goods and services
through the economy
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What are substitute goods?
http:w.sausd.us/Page/25788
Goods that are in demand due to the increase of
price of a preferred good
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What Are complimentary goods.
The rise of the price of one good
leads to a decrease in the price of
another good
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What Is Comparative Advantage?
A country being able to produce goods at a lower opportunity
cost than another country.
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What Is normative economics?
Normative economics are
opinions on how the economy
should work
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What Is the law of supply?
The higher the price of a good leads to a higher supply of
that same good
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What Is the percentage rate of
senators that get reelected?
80 percent of senators get
reelected
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What Is the law of demand?
The higher the price of one good, the higher the demand of a
related good
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How Do we measure the
Standard of living?
We measure the standard of living through Real GDP
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What Is the difference between
Real GDP and Nominal GDP?
Real GDP is based on average prices and nominal GDP is based
on current good prices
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What is the effect of inflation?
It will decrease the amount of goods and services being
purchased
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Who Counts as part of the labor
force?
People above 16 years old not involved in any full
time institutions like school and are willing to work
are part of the work force
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What Are the 3 causes of
inflation?
Cost push
Demand pull
Excess of printed money