YSU Fall Ovaska ECON STUDY GUIDE FOR THE FINAL EXAM by guy26

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									                                                                              YSU / Fall 2008 / Ovaska


ECON 2630 – STUDY GUIDE FOR THE FINAL EXAM
Listed are some of the most important concepts that we’ve covered in the macro class. While the exam
is comprehensive, it will have an extra emphasis on material covered since the second mid-term.

GDP – Measuring Total Production and Income
(Ch19)                                                Aggregate Demand and Aggregate Supply
- Gross Domestic Product (GDP) definition             Analysis (Ch. 24)
- GDP calculations                                    - AD, SRAS and LRAS
- Problems of the GDP                                 - Curve shifters
- The GDP deflator                                    - SR vs. LR equilibrium
- The Circular flow diagram of an economy             - Recessionary vs. inflationary gap
                                                      - How to use fiscal policy
Unemployment and Inflation (Ch. 20)                   - The Classical vs. Keynesian school
- Measuring unemployment
- Unemployment statistics                             Money, Banks, and the Federal Reserve System
- Types of unemployment                               (Ch. 25)
- Natural rate of unemployment                        - Desired physical characteristics of money
- Measuring inflation                                 - Functions of money
- Calculating the CPI                                 - Money definitions (M1, …) and statistics
- Comparing prices from different times               - How banks create money
- CPI biases                                          - The money multiplier
- Costs of inflation                                  - Policy goals of the Fed
- Inflation statistics                                - The place of the Fed in the U.S. economic
                                                      system
Economic Growth, the Financial System and
Business Cycles (Ch. 21)                              Monetary Policy; Fiscal Policy; Inflation,
- Economic growth statistics                          Unemployment, and Federal Reserve Policy
- Compound interest and the rule of 72                (Chs 26, 27, 28)
- Factors behind long run economic growth             - Fed’s tools for changing money supply
- The relationship between savings and                - The monetary transmission mechanism graph
investment                                            - The lessons of the past on how to run fiscal
- The business cycle graph and statistics             and monetary policy (incl. crowding out,
                                                      Ricardian equivalence, Lucas critique, proper
Long Run Economic Growth – Sources and                timing, expectations, the Phillips curve)
Policies (Ch. 22)
- Super long run economic growth statistics           Comparative Advantage and the Gains from
- Economic growth and labor productivity              International Trade (Ch. 8)
- The endogenous growth theory                        - Absolute advantage
- Creative destruction by Schumpeter                  - Comparative advantage
- The theory of economic convergence                  - Reasons for trading
                                                      - Graphing potential trading benefits
Output and Expenditure in the Short Run (Ch.          - The sources of comparative advantage
23)
- Aggregate expenditure (AE) and output
- Factors affecting AE components
- The Keynesian cross graph
- The expenditure and tax multipliers

								
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