Intermediate Macroeconomics ECN3082 L, Mussurov Altay

This account shows the flow of investment on real or financial assets between a nation and foreigners.

A model that shows how households and firms circulate resources, goods and incomes though the economy. This basic model is expanded to include the g and foreign sector.

A model that assumes there is no foreign sector (m and x).

A producer has comparative advantage if he can produce a good at lower opportunity cost than all other producers.

The price index that measures the average price level of the items in the base year market basket. This is the main measure of consumer inflation.

Tables that show the direct relationships between disposable income and consumption and saving.

A linear relationship showing how increases in disposable income cause increases in consumption.

The period where real gdp is falling.

Decreases in government spending or higher net taxes meant to shift the aggregate expenditure function downward and shift ad to the left.

Designed to avoid inflation by decreasing ad, which lowers the pl and gdpr.

When the government borrows funds to cover a deficit, the interest rate increases and households and firms are pushed out of the market for loanable funds.