Macroeconomic Concepts

Unit 4: SSEMA1-SSEMA3

Macro: Is the study ______. ______

______

SSEMA1:

The student will illustrate the means by which economic activity is measured.

SSEMA1_a

Explain the overall levels of income, employment, and prices are determined by the spending and production decisions of households,businesses, and next exports.

  • Income
  • Total______

______

  • Fixed Income
  • Income does not change ….yet the prices of goods and services do change.
  • Employment
  • ______

______

  • Net Exports (Map Slide)
  • ______

______

  • Total ______-Total ______= ______

SSEMA1_b.

Define GROSS Domestic Product (GDP),economic growth, unemployment,Consumer Price Index (CPI),inflation, stagflation, and aggregate supply, and aggregate demand.

  • GDP-(Map Slide_

GDP: ______

______

______

SSEMA1_c

Explain how economic growth, inflation, and unemployment are calculated.

SSEMA1_d

Identify structural, cyclical, and frictional unemployment.

Economic growth calculation

  • GDP is = ______
  • GDP Calculation (______)

GDP= C + I+G+Xn (HIGH LIGHT THIS AND MEMORIZE IT)

C = ______

I = ______

G=______

Xn = ______

Side Note………

The reason we subtract our imports from our exports is this: ______

______

______

  • Economic Growth______
  • Unemployment: (some pictures)

______.

SSEMA1_c:
Unemployment Rate Calculation

  • Unemployment Rate =

______

SSEMA1_d:

  • Labor Force:
  • ______
  • Structural Unemployment
  • ______
  • Frictional Unemployment
  • ______

______

  • Seasonal Unemployment
  • ______
  • Cyclical Unemployment
  • ______
  • Consumer Price Index (CPI) (Picture)
  • Is ______
  • Measures______
  • Measures ______

______.

  • CPI:______
  • Economists add up the total price of a “ ” or______They compare this ______to the ______of the same items during a ______.
  • CPI = ______/______x100
  • Index is ______which is the ______year

CPI= (Example) (Write out example in the space below)

  • Inflation
  • ______

______

  • Inflation Occurs
  • ______
  • ______
  • ______
  • ______
  • Stagflation
  • ______
  • Problematic ______

______

  • In individual markets, supply and Demand interact to (micro Econ).
  • In the nation as a______, ______supply and ______demand interact to determine whether the economy is ______or ______.
  • Aggregated Demand
  • ______

______

  • Aggregated Supply
  • ______

______

  • Two Aggregate Supply Curves (Draw graph below)
  • Short-Run Supply Curve
  • ______; because ______

______

SSEMA1_e

Define the stages of the business cycle, as was recession and depression.

  • Business Cycle
  • ______
  • Business Cycle (draw graph below)
  • Expansion to Recovery
  • ______

______

  • ______

______

  • Peak to prosperity.
  • ______
  • Contraction===______
  • ______
  • ______
  • ______
  • ______
  • ______
  • ______
  • Business sell less…______
  • ______
  • Lay off employees… ______
  • ….if this occurs for ______
  • Recession
  • ______
  • ______
  • Trough
  • ______
  • ______
  • ______
  • If it continues ______
  • Depression
  • ______

SSEMA1_f

Describe the difference between the national debt and government deficits.

  • National Debt
  • ______
  • ______.
  • Government Deficits
  • ______

SSEMA2

The Student will explain the role and function of the Federal Reserve System

SSEMA2a:

Describe the Organization of the Federal Reserve System

  • “The Fed” was established in 1914. ______

______

  • Make and ______
  • Control Reserves: ______

______

  • A system of ______banks in different ______of the nation, each of which ______paper currency called______.
  • The Federal Reserve System is run by a ______of ______, who are appointed by the U.S. ______.
  • Federal ______Market______(______)

(Decides ______M______P______of the F______)

  • ______policy.

SSEMA2b

Define Monetary Policy

  • Decisions______

SSEMA2_c

Describe how the Federal Reserve uses the tools of monetary policy to promote price stability, full employment, and economic growth

  • Price Stability
  • ______
  • Full Employment
  • ______. The fed helps in this process______

______

  • Economic Growth
  • ______

______

  • Characteristics of Money
  • Any type of currency must be ______, ______, ______, and ______in it’s a______
  • Open-Market Operations
  • (The sale or purchase of U.S. treasury bonds) to ______…loaning money ______

bonds a.k.a securities

  • Bonds-
  • ______

______

  • When ______sells securities (bonds), it ______the ______supply in hope to______.
  • In the event of a recession the Fed will ______on the open market and ______.
  • When the feds sell ______, bank ______of money______as ______and ______purchase bonds rather than save their money in banks.
  • ______buy securities it ______, This______, ______price level with increase, and more ______.

Regulating Money Supply…

  • ______.
  • Discount Rate-
  • ______.

SSEMA3

The student will explain how the government uses fiscal policy to promote price stability, full employment, and economic growth.

A. Define Fiscal Policy

B. Explain the government’s taxing and spending decisions

  • Fiscal Policy
  • ______
  • Any form of money the gov’t ______

______

  • Goal of Fiscal Policy
  • ______
  • ______
  • ______

Taxing & Spending Decisions

  • Taxes-
  • ______
  • ______.

End of Unit Three notes

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