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Macroeconomics Ultimate Cheat Sheet
FORMULAS
Labor Participation Rate - answer✔✔(Unemployed + Employed)/Population
Unemployment Rate - answer✔✔unemployed/labor force
Spending Multiplier - answer✔✔1/MPS
Tax Multiplier - answer✔✔-MPC/MPS
Money Multiplier - answer✔✔1/reserve requirement
Real Interest Rate - answer✔✔nominal interest rate - inflation rate
KEY RELATIONSHIPS - answer✔✔KEY RELATIONSHIPS
Demand Increases - answer✔✔Equilibrium price increases
Supply increases - answer✔✔Equilibrium price decreases
Consumer spending increases - answer✔✔Real GDP increases
Interest rates increase - answer✔✔investment decreases
Inflation increases - answer✔✔real wages decrease
Aggregate demand increases - answer✔✔price level increases
SR aggregate supply increases - answer✔✔Price level decreases
Government spending increases - answer✔✔Real GDP increases
Taxes increase - answer✔✔Disposable income decreases
MPC increases - answer✔✔Spending multiplier increases
Interest rates increase - answer✔✔bond prices decrease
Money supply increases - answer✔✔Nominal interest rates decrease
Reserve requirement increases - answer✔✔money supply decreases
Macroeconomics Ultimate Cheat Sheet
FORMULAS
Labor Participation Rate - answer✔✔(Unemployed + Employed)/Population
Unemployment Rate - answer✔✔unemployed/labor force
Spending Multiplier - answer✔✔1/MPS
Tax Multiplier - answer✔✔-MPC/MPS
Money Multiplier - answer✔✔1/reserve requirement
Real Interest Rate - answer✔✔nominal interest rate - inflation rate
KEY RELATIONSHIPS - answer✔✔KEY RELATIONSHIPS
Demand Increases - answer✔✔Equilibrium price increases
Supply increases - answer✔✔Equilibrium price decreases
Consumer spending increases - answer✔✔Real GDP increases
Interest rates increase - answer✔✔investment decreases
Inflation increases - answer✔✔real wages decrease
Aggregate demand increases - answer✔✔price level increases
SR aggregate supply increases - answer✔✔Price level decreases
Government spending increases - answer✔✔Real GDP increases
Taxes increase - answer✔✔Disposable income decreases
MPC increases - answer✔✔Spending multiplier increases
Interest rates increase - answer✔✔bond prices decrease
Money supply increases - answer✔✔Nominal interest rates decrease
Reserve requirement increases - answer✔✔money supply decreases
