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TOTAL PRODUCT: The total quantity of output produced by a firm for a given quantity of inputs. Total product is the foundation upon which the analysis of short-run production for a firm is analyzed. The usual framework is to analyze total product when in a variable input (labor) changes, for a given amount of a fixed input (capital). Two related concepts derived from total product are average product and marginal product.
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Lesson 16: Aggregate Shocks | Unit 1: Instability
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Page: 1 of 21
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The aggregate market is a useful analysis for the study of the macroeconomy and its adjustments.- The aggregate market tends toward equilibrium.
Short-Run Equilibrium:- Intersection of AD and SRAS curves.
- Expenditures on real output match production.
- Labor market is prone to be out of equilibrium.
Long-Run Equilibrium: - Intersection of AD and LRAS curves.
- Expenditures on real output match production.
- Labor market in equilibrium.
Real world changes can be analyzed by examining how the aggregate market adjusts toward equilibrium.
To examine aggregate market adjustments we need to make use of the ceteris paribus concept.- The aggregate market curves, AD, LRAS, and SRAS, are constructed assuming other things remain unchanged.
- The determinants of each curve, initially assumed constant, don't really stay unchanged, and they cause changes in the aggregate market.
- The purpose of this aggregate market analysis is to help us to understand why the macroeconomy tends to be unstable, volatile and prone toward business cycles.
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EXPANSIONARY MONETARY POLICY A form of monetary policy in which an increase in the money supply and a reduction in interest rates are used to correct the problems of a business-cycle contraction. In theory, expansionary monetary policy can include buying U.S. Treasury securities through open market operations, a decrease in the discount rate, and a decrease in reserve requirements. In theory, open market operations are the primary tool of expansionary monetary policy. Expansionary monetary policy is often supported by expansionary fiscal policy. An alternative is contractionary monetary policy.
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BLUE PLACIDOLA
[What's This?]
Today, you are likely to spend a great deal of time at an auction looking to buy either throw pillows for your living room sofa or a hepa filter for your furnace. Be on the lookout for celebrities who speak directly to you through your television.
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Natural gas has no odor. The smell is added artificially so that leaks can be detected.
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"You have to find something that you love enough to be able to take risks, jump over the hurdles and break through the brick walls that are always going to be placed in front of you. If you don't have that kind of feeling for what it is you're doing, you'll stop at the first giant hurdle. " -- George Lucas
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NAV
Net Asset Value
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