Prices and quantity with trade Prices and quantity with and without tariffs Calculating revenue raised from tariff Effects of tariff on domestic buyers & suppliers Inflation, Disinflation, Deflation (definitions and calculating) Using CPI to calculate inflation Nominal GDP v. Real GDP Quantity Theory of Money Velocity of money Money supply Business fluctuations Recessions Long run aggregate supply curve, Aggregate demand, and short run aggregate supply Real shocks (shocks to the LRAS) Understand LRAS, AD and SRAS graph when there are real shocks or changes in money growth or velocity. What happens to real growth and inflation? Functions of the Federal Reserve Calculating Monetary base, M1, M2 Reserve ratio Money multiplier Open Market Operations (when the Fed buys and sells bonds). What happens to interest rates when the Fed conducts open market operations? Bond prices and interest rates are inversely related. Progressive, regressive and flat tax systems Budget Deficit Calculating income tax payment if given a progressive tax code Fiscal Policy & its limits How does the government use taxes and fiscal spending to stimulate the economy Fiscal policy during recessions
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