question
Production function One period model
answer
Y=zF(K, Nd)
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Y
answer
Output
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Z
answer
total factor productivity
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K
answer
Capital
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Nd
answer
labor
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What equation is constant?
answer
MRS= W
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What is MRS
answer
Mul/Muc
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C=w(h-l)+pi- T
answer
w: wage
h: hours you're given
l: leisure
pi: profit
T: Taxes
C: consumption
h: hours you're given
l: leisure
pi: profit
T: Taxes
C: consumption
question
leading variable
answer
predicts the path of GDP
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lagging variable
answer
when GDP predicts the path of a variable
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Labor Force
answer
unemployed+ employed
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Unemployment rate
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unemployed/labor force x 100
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Participation rate
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labor force / working age population (16+)
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Countercycle
answer
moving in the opposite direction of the business cycle of economic downturns and upswings
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GDP
answer
Gross Domestic Product- the total market value of all final goods and services produced annually in an economy
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GNP
answer
Gross National Product - the sum of all goods and services produced in a nation in a year
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Income Approach
answer
A method of computing GDP that measures the income-wages, rents, interest, and profits-received by all factors of production in producing final goods and services.
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Expenditure Approach
answer
A method of computing GDP that measures the total amount spent on all final goods and services during a given period.
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Product Approach
answer
The approach to GDP measurement that determines GDP as the sum of value added to goods and services in production across all productive units in the economy.
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GDP/Capita
answer
Measure of how an economy performs
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Behaviors of aggregate demand
answer
- economic growth (LR)
-Business Cycles (SR)
-Business Cycles (SR)
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