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AP Macro Formulas Flashcards

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6062921567Gross Domestic ProductConsumption + Investment + Govt. Spending + (Exports - Imports)0
6062933679National IncomeWages + Rents + Interest + Profits1
6062942481% Change in GDP (Real or Nominal)(Year New - Base Year)/Base Year x 1002
6063539388Labor Force Participation RateLabor Force/Pop. aged 16+ x 1003
6063545252Unemployment Rate# unemployed workers/Labor Force x 1004
6160308471Natural UnemploymentFrictional unemployment + Structural unemployment5
6160313528Actual UnemploymentNatural unemployment + Cyclical unemployment6
6160320463Inflation Rate using PRICE LEVELPrice level Yr 2 - Price level Yr 1 / Price level Yr 1 x 1007
6160333909Price Index in a given yearCost of market basket Yr 1/Cost of market basket base year x 1008
6160347189Inflation rate using PRICE INDEXPrice Index Y2 - Price Index Y1 / Price Index Y1 x 1009
6160358072GDP DeflatorIn same year; Nominal GDP/Real GDP x 10010
6422833465Marginal Propensity to ConsumeConsumer Spending Change/Disposable Income Change11
6422842906Spending Multiplier1/1-MPC or 1/MPS12
6422850678Spending change in GDPSpending Multiplier x New Spending13
6422854415Output GapActual Output - Potential Output/Potential Output14
6422879719Future Value of MoneyFV = PV x (1 + r) where r = interest rate15
6422896661Present Value of MoneyPV = FV/1 + r where r = interest rate16
6589743641Government Spending Multiplier1/MPS17
6589746938Tax or Transfer MultiplierMPC/MPS Can be a positive or negative number. Tax cuts are positive, increasing taxes negative number.18

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