MindMap Gallery Principles of Economics (Part 2) Macroeconomics
Principles of Economics (Part 2) Macroeconomics Mankiw Mind Map Summary of content, a set of institutions in the economy that help one person's savings match another person's investment.
Edited at 2022-05-18 08:26:53Avatar 3 centers on the Sully family, showcasing the internal rift caused by the sacrifice of their eldest son, and their alliance with other tribes on Pandora against the external conflict of the Ashbringers, who adhere to the philosophy of fire and are allied with humans. It explores the grand themes of family, faith, and survival.
This article discusses the Easter eggs and homages in Zootopia 2 that you may have discovered. The main content includes: character and archetype Easter eggs, cinematic universe crossover Easter eggs, animal ecology and behavior references, symbol and metaphor Easter eggs, social satire and brand allusions, and emotional storylines and sequel foreshadowing.
[Zootopia Character Relationship Chart] The idealistic rabbit police officer Judy and the cynical fox conman Nick form a charmingly contrasting duo, rising from street hustlers to become Zootopia police officers!
Avatar 3 centers on the Sully family, showcasing the internal rift caused by the sacrifice of their eldest son, and their alliance with other tribes on Pandora against the external conflict of the Ashbringers, who adhere to the philosophy of fire and are allied with humans. It explores the grand themes of family, faith, and survival.
This article discusses the Easter eggs and homages in Zootopia 2 that you may have discovered. The main content includes: character and archetype Easter eggs, cinematic universe crossover Easter eggs, animal ecology and behavior references, symbol and metaphor Easter eggs, social satire and brand allusions, and emotional storylines and sequel foreshadowing.
[Zootopia Character Relationship Chart] The idealistic rabbit police officer Judy and the cynical fox conman Nick form a charmingly contrasting duo, rising from street hustlers to become Zootopia police officers!
Principles of Economics (Part 2) macroeconomics
income
GDP - gross domestic product
Measuring the flow of currency
Total household expenditure/total income paid by all businesses
The market value of all final goods and services produced in a country during a given period
GDP only includes the value of final goods, and inventory investment is a part of GDP
GDP=C I G NX Consumption Investment Government purchases Net exports
Consumption: What households spend on goods and services other than buying new homes
Investment: Spending on capital equipment, inventories, and buildings, including new homes purchased by households
government purchase
Net Exports: Exports – Imports
Real GDP: production of goods and services valued at constant prices
Nominal GDP: production of goods and services valued at current prices
GDP deflator = nominal GDP/real GDP: Monitoring price levels
Inflation rate = (Δ GDP deflator)/first-year GDP deflator
GDP is not a perfect measure of welfare
Not including value of activities outside the market
Does not include environmental quality
No income distribution involved
GNP Gross National Product
Total income earned by permanent residents of a country
NNP net national product
Total income of a country’s residents less depreciation
national income
Basically the same as NNP, the difference is due to statistical error
personal income
Excludes retained earnings
personal disposable income
Personal income less personal taxes and non-tax payments
expenditure
CPI-Consumer Price Index
Determination of CPI
fixed basket
find out price
calculate cost
Select base year and calculate index = current year expense/base year expense
Inflation rate = (CPI in the second year - CPI in the first year) / CPI in the first year
question
substitution bias
Introduction of new items
Unmeasurable changes in quality
PPI-Producer Price Index
Indexation: the automatic adjustment of the quantity of money according to the effects of inflation
Nominal interest rate: A generally published interest rate that is not corrected for the effects of inflation
Real interest rate: an interest rate corrected for the effects of inflation
increase
productivity
physical capital per capita
foreign capital investment
human capital per capita
Education: Human Capital Investment
Health and Nutrition
natural resources per capita
property
political stability
free trade
outward-looking policy
inward-looking policy
technical knowledge
research and development
population growth
leading to stress on natural resources
dilution of capital stock
Promote technological progress
Production Function
Diminishing returns: As the amount of input increases, the return from each additional unit of input decreases.
Catch-up effect: The characteristic that countries that start out poor tend to grow faster than countries that start out rich
unemployment
measure
Employed
Unemployed: A person who is able to work and has tried to find a job but has not found one.
frictional unemployment
structural unemployment
Look for work
Minimum wage forces wages above the balance between supply and demand
Trade unions and collective bargaining
Efficiency wage theory: high wages increase efficiency
worker health
worker turnover rate
Worker quality
worker effort
Non-labor force: full-time students, houseworkers, retirees, etc.
Unemployment rate = number of unemployed people / (labor force = number of employed people number of unemployed people)
natural rate of unemployment
cyclical unemployment rate
Participation rate = labor force/adult population
government employment agencies
Employment website
University Career Counseling Office
head-hunting company
unemployment insurance
finance
financial system
A set of institutions in an economy that facilitates matching one person's savings with another person's investments
Financial market
Bond Market
Bonds: Debt Financing
the term
credit risk
tax treatment
stock market
Stocks: Equity Financing
price
dividend
PE: stock price/earnings per share over the past year
financial intermediaries
Bank: deposits, high and low interest rates
Mutual Fund: An institution that sells shares to the public and uses the proceeds to purchase a portfolio of stocks and bonds.
index fund
savings, investment
National Savings/Loanable Funds
private savings public savings
Loanable funds: the flow of resources available to finance private investment
Budget deficit: reduced national savings, higher interest rates, lower investment
supply and demand
savings incentives
investment incentives
budget surplus
financial crisis
The price of an asset drops significantly
Bankruptcy of financial institutions
Decline in confidence in financial institutions
Insufficient credit
economic downturn
The economy behaves as a vicious cycle
finance
Finance: the study of the decisions people make about allocating resources and responding to risks within a certain period of time
time
Present value: The amount of money now required to generate a certain amount of money in the future using current interest rates.
Future value: When the current interest rate is given, the current amount of money will bring about the future amount of money.
Compound interest: accumulation of money amount, interest compounding
70 specification: interest rate is x, doubled after 70/x years
risk
risk aversion
Insurance
adverse selection
Moral Hazard
Diversification
Reduce risk by replacing one risk with a large number of small, unrelated risks
Risks and benefits
Asset valuation
Fundamental analysis
The study of a company's accounting statements and future prospects to determine its value
efficient market hypothesis
The price of a security reflects all known information that affects its value
market irrationality
Stock prices deviate from rational expectations of their true value
currency
basic concept
Function
sales unit
medium of exchange
"fluidity"
store of value
"wealth"
type
Commodity currency: intrinsic value, gold standard
Fiat Currency: No Intrinsic Value
money quantity
cash
demand deposit
currency savings
central bank
Fed
lender of last resort
money supply, monetary policy
People's Bank of China
bank
reserves
Deposits that a bank receives but does not lend out
T-Account: Balance Sheet
Reserve ratio: the proportion of deposits held by banks as reserves
Money multiplier: the reciprocal of the reserve ratio
bank capital
The resources that the bank’s owners devote to the institution
Bank stocks, bonds
Owner's Equity = Assets - Liabilities
Leverage ratio: the ratio of a bank’s total assets to its capital
A 100% reduction in capital constitutes bankruptcy
money supply
open market operations
Bank loan
Discount rate: The interest rate at which banks borrow from the central bank
short auction
Federal Funds Rate: The interest rate a bank pays for an overnight loan from another bank
reserves
Reserve amount
Statutory Reserves: Minimum reserves held by banks based on deposits
interest on reserves
bank run
currency circulation
inflation
An increase in the general price level is called inflation, and the opposite is deflation.
Price level and currency value: The general price level increases and the value of currency decreases
In the long run, the price level will adjust to a level where money demand equals money supply.
Influence
Relative price changes and resource misallocation
cause tax distortions
Currency as a unit of measurement causes confusion and inconvenience
economic variables
Nominal variable: a variable measured in avoidance units
Real variables: variables measured in physical units
Monetary neutrality: the view that changes in the money supply do not affect real variables
circulation
Money circulation velocity V=PxY/M (price level x output/money quantity)
The velocity of money circulation remains basically unchanged
When the amount of money increases rapidly, a high inflation rate occurs
"Inflation tax", which is paid by printing money that should actually be raised through bonds, etc. Effectively taxing everyone who uses the currency
Fisher effect: nominal interest rate = real interest rate inflation rate
international market
movement of items
Exports: Goods and services produced domestically and sold abroad
Imports: Goods and services produced abroad and sold domestically
Net Exports: Exports - Imports, Trade Balance
Trade surplus: Exports > Imports
Trade deficit: Imports > Exports
Trade balance: imports = exports
capital flows
Net Capital Outflow: Net Foreign Investment
Net capital outflow (NCO) = net exports (NX)
Savings = Domestic investment Net capital outflow
international transaction price
Nominal exchange rate: exchange rate for cash
Appreciation, depreciation
Real exchange rate: the rate at which goods and services from one country are exchanged for goods and services from another country
Real exchange rate = nominal exchange rate x domestic price/foreign price
purchasing power parity theory
supply and demand
loanable funds market
foreign exchange capital market
policy
Government deficit: negative public savings, reducing the supply of loanable funds and crowding out investment
trade policy
Tariffs, import quotas
Trade policy does not affect the trade balance
Political instability and capital flight
economic fluctuations (short term)
economic contraction
Recession: A period in which real incomes fall and unemployment increases
depression: severe recession
feature
irregular and unpredictable
Most macroeconomic variables fluctuate simultaneously
Unemployment increases as output decreases
Root causes of volatility
Changes in aggregate supply
Change in aggregate demand
demand and supply
Aggregate demand curve: slopes downward to the right
Aggregate supply curve: slopes upward to the right
Price Level and Consumption: Wealth Effect (Equilibrium)
Price Level and Investment: Interest Rate Effect (Equilibrium)
Price level and import and export: exchange rate effect (equilibrium)
Consumption causes supply and demand curves to shift
Investment causes supply and demand curves to shift
Government purchases cause supply and demand curves to shift
Changes in net exports cause supply and demand curves to shift
policy impact
Monetary Policy
Liquidity preference theory: Adjustment of interest rates balances money supply and money demand
money supply
money demand
Equilibrium in Money Markets: Equilibrium Interest Rate
interest rate effect
Fiscal policy
Changes in government purchases
tax changes
Multiplier effect: Every dollar of government spending increases the total demand for goods and services by more than one dollar
Crowding out effect: expansionary fiscal policy causes interest rates to rise, and reductions in investment expenditure cause aggregate demand to decrease.
Inflation and unemployment
The Phillips Curve: Weighing Inflation and Unemployment in the Short Run
Natural rate of unemployment: In the long run, unemployment does not depend on money growth and inflation
Unemployment rate = natural unemployment rate - a (actual inflation - expected inflation)
The cost of lowering inflation
Sacrifice rate: when inflation decreases by 1 point, the corresponding number of points lost in annual output
rational expectations
caused by economic crisis
issue
Are monetary and fiscal policies needed to stabilize the economy? ——Whether it depends on the market to adjust itself
Should the government increase spending or cut taxes to fight the recession? ——Government demand or market demand should be adopted
Should monetary policy be based on rules or discretion? ——Seeking stability or development?
Should central banks aim for zero inflation? ——Is it better to be stable or unstable?
Should the government balance the budget? ——Is it an advance for the future?
Do you want to encourage savings? ——Private savings or public savings?
By: One share makes seven