REVIEW EXAM 2
ECONOMICS 152

McCONNELL AND BURE MACROECONOMICS TEXT: CHAPTERS 6, 9, 10, 11, AND 12

EQUILIBRIUM IN THE AGGREGATE EXPENDITURE MODEL

NATIONAL INCOME MULTIPLIER
RELATIONSHIP BETWEEN SHIFTS IN THE AE SPENDING COMPONENTS &
     EQUILIBRIUM GDP
RELATIONSHIP BETWEEN THE MARGINAL PROPENSITY TO CONSUME & THE SIZE
     OF THE MULTIPLIER

INTERNATIONAL TRADE & EQUILIBRIUM GDP
DEFINITION OF NET EXPORTS
FOREIGN TRADE, SPECIALIZATION, AND COMPARATIVE ADVANTAGE
TOOLS FOR GOVERNMENT INTERVENTION IN FREE TRADE
FOREIGN EXCHANGE MARKETS
     DEPRECIATION AND APPRECIATION OF CURRENCY
HOW POSITIVE AND NEGATIVE X SHIFT AE CURVE

GOVERNMENT PURCHASES, TAXATION, AE, & EQUILIBRIUM GDP
EFFECTS OF ADDING G TO AE AND CHANGES IN EQUILIBRIUM GDP
EFFECTS OF TAXES ON CONSUMPTION SPENDING
BALANCED BUDGET MULTIPLIER

EQUILIBRIUM VERSUS FULL EMPLOYMENT GDP
RECESSIONARY GAP
INFLATIONARY GAP

AGGREGATE DEMAND / AGGREGATE SUPPLY MODEL
AGGREGATE DEMAND AND WHY IT SLOPES DOWNWARD
     WEALTH, INTEREST RATE, & FOREIGN PURCHASES EFFECTS
DERIVING THE AD CURVE FROM THE AE MODEL
DETERMINANTS OF AGGREGATE DEMAND
CHANGES IN AGGREGATE DEMAND CURVE
SHIFTS IN THE AE SCHEDULE AND CHANGES IN AD
AGGREGATE SUPPLY - HORIZONTAL, INTERMEDIATE, & VERTICAL RANGES
CHANGES IN AGGREGATE SUPPLY
EQUILIBRIUM WITHIN THE AD/AS MODEL
     INTERMEDIATE RANGE
     HORIZONTAL RANGE
     VERTICAL RANGE
CHANGES IN AD - HORIZONTAL, INTERMEDIATE, & VERTICAL RANGES
THE MULTIPLIER WITH PRICE LEVEL CHANGES
CHANGES IN AS
EFFECTS OF CHANGES IN AS ON EQUILIBRIUM GDP AND THE PRICE LEVEL

FISCAL POLICY
EXPANSIONARY FISCAL POLICY
CONTRACTIONARY FISCAL POLICY
PROBLEMS WEAKENING FISCAL POLICY