AP Macro

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  1. structural unemployment
    fired because skills no longer in demand
  2. unemployment rate
    percentage of the labor force unemployed at any time
  3. gov't deficit spending is financed by
    issuing new bonds
  4. Fed buys securities on open market; what decreases?
    interest rates (in the short-run)
  5. factors for economic growth
    quantity/quality of resources

    amt. of capital goods available

  6. favorable supply shock effects on price level/output
    • price: decrease
    • output: increase
  7. stagflation
    high inflation + high unemployment + stagnant demand
  8. effect of central bank selling securities on open market
    decrease money supply

    increase interest rates

    decrease aggregate demand
  9. federal funds rate
    interest rate that banks charge one another for short-term loans
Card Set
AP Macro
ap macro test review 2005
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