Note_card-9.docx - Biren Patel Macroeconomics Notes cards 9...

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Biren Patel Macroeconomics Notes cards 9 1. Macroeconomics formula for inflation Ct + I + G + (X - N) > GNP Ct = Consumer Demand I = Inverse Demand G = Government Demand X = Exports N = Imports 2. Macroeconomics formula for deflation Ct + I + G + (X - N) < GNP Ct = Consumer Demand I = Inverse Demand G = Government Demand X = Exports N = Imports 3. GDP Gross Domestic Product is defined as the value of all the goods and services produced for the domestic economy in a given year. 4. GNP Gross National Product is defined as the value of the all goods and services produced in a given year. 5. Inflation Inflation is defined as constantly rising prices. 6. Deflation Deflation is defined as constantly falling prices. 7. Steps in supply side economics 1. Lower the taxes to the rich. 2. Since they have the highest saving rate the supply of money will increase.(6 months) 3. This will cause the interest rate to fall. (6 months) 4. Business will put together a business plan to present to banks, so they can borrow the Money. (6 months)
5. Once they have the loan they will hire and architect to design the building. (one year)

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