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APMacro: Aggregate Demand

Aggregate demand help to explain how and why real GDP and price levels change in the national economy. Aggregate demand illustrates the total amount of demand for a country’s products at each price level. 205 more words

AP Macro

APMacro: Investment Demand

The firm’s decision to invest in plant and equipment depends on the marginal benefit and marginal cost of the investment. Therefore, if the expected rate of return on the investment is greater than the real interest rate for the loan to make the purchase, the firm will make the investment. 94 more words

AP Macro

APMacro: Consumption and Savings

Consumption and saving affect disposable income. Households can only do two things with their income: spend it or save it. The consumption function demonstrates that those with lower disposable incomes spend a higher percentage of their incomes and save less or even dissave, while those with higher disposable incomes spend a smaller percentage of their incomes and have a higher percentage of saving. 212 more words

AP Macro

APMacro: Economic Indicators Quiz

                        

Economic Indicators: Gross Domestic Product (GDP), Real GDP, Inflation Rate – Consumer Price Index (CPI), Unemployment Rate, Phillips Curve, rule of 70, Okun’s Law

AP Macro

APMacro: Helped and Hurt by Inflation

Inflation affects consumers by reducing the value of the dollar. Nominal income is the wage in current dollars, while real income removes the effects of inflation, measuring the value of what the paycheck will actually buy in the economy. 146 more words

AP Macro

APMacro: Inflation

Inflation is the increase in the general level of prices. The Consumer Price Index measures the prices of a market basket of goods purchased by the typical urban consumer. 216 more words

AP Macro