AP Macro-Economics Chapter 2 Vocabulary

208775171	Gross Domestic Product (GDP)	A measure of the value of all the goods and services newly produced in an economy during a specified period of time.
208775172	Relative Price	The price of a particular good compared to the price of other things.
208775173	Economic Variable	Any economic measure that can vary over a range of values.
208775174	Controlled Experiments	Empirical tests of theories in a controlled setting in which particular effects can be isolated.
208775175	Experimental Economics	A branch of economicsthat uses laboratory experiments to analyze economic behavior.
208775176	Circular Flow Diagram	A diagram illustrating the flow of duns through the economy as people buy and sell in markets.
208775177	Economic Model	An explanation of how the economy or part of the economy works.
208775178	Positively Related	A situation in which an increase in one variable is associated with an increase in another variable; also called "Directly Related"
208775179	Negatively Related	A situation in which an increase in one variable is associated in a decrease in another variable; also called "Inversely Related"
208775180	"Ceteris Paribus"	"All other things being equal"; Refers to holding alll other variables constant or keeping all other things the same when a variable is changed. (Things NOT Ceteris Paribus are factors OUTSIDE of money that influence the demand curve)
208775181	Microeconomics	The branch of economics that examines individual decision-making at firms and households and the way they interact in specific industries and markets.
208775182	Macroeconomics	The branch of economics that examines the workings and problems of the economy as a whole-GDP, growth, and unemployment
208775183	Mixed Economy	A market economy in which the government plays a very large role.
208775184	Positive Economics	Economic Analysis that explains what happens in the economy and why, without making recommendations about economic policy.
208775185	Council of Economic Advisers	three-member group of economists appointed by the president of the united states to analyze the economy and make recomendations about economic policy.