Macroeconomics

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Author:
damea134
ID:
225722
Filename:
Macroeconomics
Updated:
2013-07-03 18:27:38
Tags:
Chapter 18
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Description:
Flash cards from Principles Of Macroeconomics 6th Edition Mankiw
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  1. appreciation
    an increase in the value of a currency as measured by the amount of foreign currency it can buy
  2. balanced trade
    a situation in which exports equal imports
  3. closed economy
    an economy that does not interact with other economies in the world
  4. depreciation
    a decrease in the value of a currency as measured by the amount of foreign currency it can buy
  5. exports
    goods and services that are produced domestically and sold abroad
  6. imports
    goods and services that are produced abroad and sold domestically
  7. net capital outflow
    the purchase of foreign assets by domestic residents minus the purchase of domestic assets by foreigners
  8. net exports
    spending on domestically produced goods by foreigners (exports) minus spending on foreign goods by domestic residents (imports); the value of a nation's exports minus the value of its imports; also called the trade balance
  9. nominal exchange rate
    the rate at which a person can trade the currency of one country for the currency of another
  10. open economy
    an economy that interacts freely with other economies around the world
  11. purchasing-power parity
    a theory of exchange rates whereby a unit of any given currency should be able to buy the same quantity of goods in all countries

    The Law of One Price
  12. real exchange rate
    the rate at which a person can trade the goods and services of one country for the goods and services of another

    RER = (Nominal Exchange Rate x Domestic Price)/ Foreign Price
  13. trade balance
    the value of a nation's exports minus the value of its imports; also called net exports
  14. trade deficit
    an excess of imports over exports
  15. trade surplus
    an excess of exports over imports
  16. Increase in International Trade
    • Improvements in:
    • Transportation
    • Telecummincation 
    • Technological progress
    • Government Trade Pocilies
  17. National Savings
    • S = y-c-g 
    • or
    • S=I+NX
    • or 
    • S = I+NCO
  18. Exchange Rate
    E= Price of Foreign Good/ Price of Domestic Good

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