Test#2 Study Guide

Test#2 will consist of 20 True/False questions each worth 5 points. You will have 1 hour and 20 minutes to take the test. 

The following are a list of topics to study for the test. 

• Real GDP
• Nominal GDP
• Determining actual growth in aggregate output
• Real per capita GDP

• Employment
• Underemployment
• Discouraged workers
• Marginally attached workers
• The relationship between real GDP and changes in the unemployment rate

• Possible reasons that lead to job loss
• The minimum wage
• The natural rate of unemployment

• Shoe-leather costs
• Unit-of-account costs
• Nominal interest rate
• Real interest rate

• The aggregate price level
• Price index
• Consumer Price Index
• Producer Price Index

• Planned aggregate spending
• Unplanned inventories 
• The multiplier

• Reasons why the aggregate demand curve has a negative slope
• What causes Aggregate demand to decrease

• Reasons why the short-run aggregate supply curve is positively sloped
• What causes short-run aggregate supply to increase