Notesale: Turn your study into money

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1) Business cycle- Short run economic fluctuations
2) Recession- periods of falling real incomes and rising unemployment
3) Depression- Severe recessions (rare)
4) 3 Key Facts About Economic Fluctuations- They are irregular and unpredictable,
most macroeconomic quantities fluctuate together, and as output falls,
unemployment rises
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Real variables-quantities, relative prices
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6) Monetary neutrality- Changes in the money supply affect nominal but not real
variables
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7) What do classical economists and Keynesian economists say about monetary
neutrality in the short run and the long run? Most economists believe classical
theory describes the world in the long run, but not in the short run
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9) Using the AD and the short run as well as the long run AS curves, show the long
run and short run equilibrium
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Growth in the money supply shifts AD to the right
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10) What is the natural rate of output (or full-employment output)? Full
employment is often an aim for an economy, but most economists see it as more
beneficial to have some level of unemployment, especially of the frictional sort
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Better physical capital
b
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Interest rates, monetary policy

d
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Stock market boom/crash
b
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Tax hikes/cuts
3) Changes in G:
a
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State and local spending
4) Changes in NX:
a
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Appreciation/ depreciation resulting from international speculation

12) Know the sticky-wage theory
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