Macro

• AD = C + I + G + (x-m)
• How do you work out nominal GDP?

  Output (total output), Income (total of factor incomes, wages, salaries. etc) , Expenditure (AD eq)
• Real GDP = Nominal GDP / price index x 100
• GDP deflator = Nominal GDP / Real GDP x 100
• Nominal GDP = Real GDP x Price index / 100 or C+I+G+(x-m)
• GNI (Gross national income) 


  GDP + Net factor income
• Green GDP


  GDP - Environmental costs
• Equal balance of payment 


  I + G + X = S + T + M
• Multiplier = 1 / 1 - MPC
• Change in National Income


  Initial injection x multiplier
• Accelarator


  increased rate of gdp growth ---> increased investment
• budget deficit 


  Gov spending > Tax revenue in a year
• Budget Surplus 


  Tax revenue > Gov spending in a year
• Unemployment rate 


  Unemployed / Labour force x 100
• Index number 


  Raw Number / Base year x 100
• Percentage change 


  new - original / original x 100
• Weighted price index


  CPI

  
• Real interest rate 


  Nominal interest rate - inflation rate
• Taxable income


  Income - Tax free allowance
• Average rate of tax

  Tax paid / income x 100
• Marginal rate of tax

  Change in tax paid / change in income x 100
• Gini coefficient 


  Area between line of perfect equality and lorenz curve / Total area beneath line of perfect equality
• Absolute poverty 


  < $2.15 /day
• Relative poverty 


  < 60% of median income
• Current account deficit 


  Financial + Capital Account Surplus
• Current Account Surplus 


  Financial + Capital Account Deficit
• Marshall lerner condition 


  PEDx + PEDm > 1 (Price elasticity of imports and exports must be more 1 to improve the budget deficit
• Terms of trade


  index of export prices / index import prices x 100
• HDI

  0.8 and above = very high, 0.7 - 0.79 = high, 0.55 -0.69 =medium, <0.55 = low
• Bond yield

  Coupon rate / market price x 100
• Money multiplier

  1 / r
• Fisher equation

  M V = P Q where V and Q are constant
• Liquidity ratio

  Current assets / current liabilities x 100
• Capital ratio

  Capital / loans x 100