AP Macro

Hi all…this page will serve as our online resource for AP Macroeconomics.  Assignments, practice assessments, video lectures and other materials will be here .  Be sure to use this page throughout the course.

AP MACRO EXAM REVIEW MATERIALS:  Below are lots of materials for you to use as you review for your AP Macro Exam.  Some will be assigned, others for your own use.  There are also links to other websites that are good for review as well.

AP Macroeconomics Formulas and Definitions – Basic formulas and definitions you need to know.

AP review nuts and bolts – Models to know, vocab. to review, FRQ topics over the last 10 years

Macro Exam Review Models1 – a blank copy of major models you need to work through (graphs, etc)

Macro Exam Review Models – a complete copy of the same major models for you to review.

AP Macro Practice Test – 60 multiple choice practice questions…

Macro sample Test 1Macro sample Test 2Macro sample Test 3Macro sample Test 4Macro sample Test 5 – There are sample tests by topic: Test 1 – Econ Performance, Test 2 – Fiscal/Keynesian Policy, Test 3 – Money and the Fed, Test 4 – LRAS Models, Test 5 – International Economics and Trade

Macroeconomics Sample Questions by Topic – Topical questions for review of course material.

2001 FRQ2002 FRQ2003 FRQ2004 FRQ2005 FRQ2006 FRQ2007 FRQ2008 FRQ,

2009 FRQ2010 FRQ2011 FRQ2012 FRQ

LINKS TO EXPLORE:

AP Macroeconomics College Board Page

A Macro study guide

Welker’s Wikinomics Macroeconomics page

Latest work…Here are resources and summaries related to Chapter 35 – The short-run and long-run Phillips Curve.  Also below is a reading and notes on the Laffer Curve.  Remember – UNIT 4 TEST APRIL 24th!!!

Chapter 35 Text Summary – PowerPoint

Phillips Curve Practice Qs

Laffer Curve reading

Laffer Curve notes

Below is the chapter 32 PowerPoint summary, as well as related articles – some of which we will use in class.  Of course, email with questions: matthew.schultz@greece.k12.ny.us

Chapter 32 Summary – Chapter PowerPoint based on textbook

Related articles with questions…

Exchange rates and trade

Excuse me..trade imbalance

Stability and the Swiss Franc

The high cost of tariffs

UNIT 4 TEST WILL BE WEEK OF APRIL 22nd…

APRIL BREAK ASSIGNMENT…all materials needed for the April Break assignment are below.  You are basically starting Unit 4 by summarizing chapters 26 and 31, and completing problem sets related to those topics. Unit 4 focuses on International Economics.  Specifically there are two things exchanged in the global market, money and goods.  Money is graphed using the Loanable Funds Market, and how it ties to Net Capital Outflow.  Goods are measured in terms of Real Exchange Rates (.5 US pretzels for 1 German pretzel) rather than Nominal Exchange Rates (1 US dollar equals 1.25 Euro).  Nominal Exchange rates are measured in terms on currency, Real Exchange Rates are measured in terms of goods…

As you work through the content, it may help to focus on those three areas: Loanable Funds Market, NCO (Net Capital Outflow), and Exchange Rates (real and nominal)

Materials Needed:

April Break Assignment Overview

Chapter 26 PowerPoint Summary

Chapter 31 PowerPoint Summary

Loanable Funds vs. Money Market Analysis

Loanable Funds Practice Set

Ch. 31 Problem Set – The Open Economy

Good Luck…Email with any questions: matthew.schultz@greece.k12.ny.us

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UNIT 3 – POLICYMAKING with AD/AS MODELS

So we explored the Money Market through a connection to AD/AS.  The next step is to understand the Federal Reserve System and its role in monetary policy.  In order to do that, use the resources below.

Ch 29 – The Monetary System – A PowerPoint that summarizes this chapter from our text.

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This is the heart of the AP Course, and you must be able to create solutions to real economic issues that stem from the AD/AS model.  The difficult part of this unit, is that the AP exam expects students to be able to connect all the major models from the course together – you truly need to see the big picture here.

Chapter 33 provides an overview of AD/AS models – see the Power Point here:

Ch. 33 Text PowerPoint Summary

Practice with the AD/AS Model

Chapter 34 connects fiscal policy and monetary policy to the AD/AS model.  It is much more involved.  You will need to completely understand the Money Market model as tied to Federal Reserve monetary policy – but also you should be able to connect it to the AD/AS model.  Lastly, fiscal policy (taxing and spending) needs to connect to the Keynesian approach and the Spending and Tax multipliers.  Check out some resources here:

Ch 34 Text PowerPoint Summary

Chapter 34 Notes and Examples

That’s it for now…much more to follow next week.

– Schultz

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REVIEW FOR UNIT 2 EXAM (EXAM DATE IS FRIDAY, MARCH 1st): Exam will consist of 45 multiple choice questions, as well as ONE free-response question.  The exam will be timed (50 min. for m/c, 20 min for FRQ)

The following PowerPoint summaries are directly from the text – Mankiw – please review them as they focus on the big concepts that you will be tested on.

GDP PowerPoint Summary

Inflation PowerPoint Summary

Unemployment PowerPoint Summary

Practice Exam:  Practice Test Here…

STUDY…and GOOD LUCK

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FEBRUARY BREAK ASSIGNMENT:  DUE FRIDAY, MARCH 1st. 

EXTENDED DUE DATE TO MARCH 1st – FRIDAY.  I WILL REVIEW ANY PAPERS ON MONDAY OR WEDNESDAY WITH YOU, and FINAL PAPERS ARE DUE MARCH 1st.

Use the resources below to complete a comparative written response to the task.  You must present an argument, based on the data and evidence you will be using, as to the reasons for the differences and/or similarities in the economic well-being between two nations.  You will focus on Gross Domestic Product, Inflation and Unemployment as your evidence and data.

Assignment (Task): Using economic data and trends, you need to compare the current state of the US Economy to that of one other nation.  Lastly, you will provide an argument that focuses on the reasons you think these differences and/or similarities exist.  This argument needs to be grounded in research, data and evidence.

1.  Go to the Khan Academy links and watch the videos that pertain to GDP, Inflation and Unemployment.  They are great resources and will give you background on all three.

2.  Using the links below, you will research the current state of the US Economy (GDP, Inflation, Unemployment).

3.  You will pick any other nation, and complete the same research with regards to that country.  For example, you could compare the US Economy to Belgium, or Ghana, or Brazil, or Turkey, or Costa Rica, or Canada, or India, or New Zealand, or Burkina Faso, or Russia, or Estonia, or Laos, or Indonesia, or Belize, or Trinidad and Tobago, or Jamaica, or Portugal, or South Africa, or Peru, or South Korea, or Jordan, or Tanzania, or Oman, or Finland, or Sweden, or Mongolia, or Gabon, or Guyana, or El Salvador, or Greece, or Uzbekistan, or Mali, or Nepal, or the Philippines, or Fiji, or Switzerland, or…get the picture? Any other nation you want.

4.  You need to organize your research and data in order to write an analytically comparative paper in which you draw conclusions based on evidence and data.

5.  Lastly, in your paper, you MUST present an argument, based on evidence, as to the similarities and/or differences between the economic conditions of the United States, and the other nation you selected.

So, part 1 – US data; part 2 – other nation’s data; part 3 – analytical comparison; part 4 – your argument.

LINKS:

Khan Academy Links:

An Overview of Macroeconomics

GDP Videos

Inflation Videos

A Video on Unemployment

US Economic Data Links:

US Dept. of Labor – Bureau of Labor Statistics

Data and Research from the Federal Reserve Bank of St. Louis

US Dept. of Commerce – Bureau of Economic Analysis

International Economic Data Links:

New Link: World Bank Data Page – Excellent source of data…a student in class recommended this site.  Check it out!

International Monetary Fund – Country Information

Federal Reserve Bank of New York – Global Economic Indicators

Federal Reserve Bank of St. Louis – International Economic Trends

Feel free to search google and other sources – BUT, be sure your resources are professional and appropriate.

Enjoy and HAVE FUN!!!  Email me with questions or issues: matthew.schultz@greece.k12.ny.us

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Unit 2:  Economic Indicators: Our next unit centers on major economic indicators: GDP, Inflation and Unemployment.  We will explore these three measures of an economy, evaluate their effectiveness, and ultimately begin to shape policy based on them.  This is our first major macroeconomic unit, and as such, it is definitely heavily tested on the AP exam.

Indicator #2: Inflation and CPI (Consumer Price Index).  Inflation is the measure of price change overtime.  It is our second great macroeconomic indicator.  Inflation occurs in an economy for two major reasons: too much spending, or too little production.  An easy way to remember this is the following definition for inflation:  too many dollars chasing too few goods.  So, either there are too many dollars (too much spending), or too few goods (too little production .  In either case, we have a shortage of goods, which results in higher prices. Essentially our dollars are worth less because they lose purchasing power.  Inflation attacks wages, savings, wealth, etc.  Inflation above 5% can be very dangerous.  The other way inflation occurs is when too many dollars are pumped into the economy through the Federal Reserve System.  Basically there are more new dollars in the banking market, and therefore the value of dollars decreases.   We know this as interest rates (they drop when lots of money is introduced into banks).  There are also implications for trade as well with inflation…we’ll get into that later.

There are many different aspects to inflation, so take time to complete the chapter 24 summary, and review the concept with the resources below.  A video on GDP and inflation is coming soon.

Inflation Work and Resources:

Intro to Inflation – this packet will take you through the chapter 24 summary from Mankiw.  It also presents some introductory problem sets for you to practice with.  Good luck!

More Inflation Problems for You! – If you were able to complete the packet “Intro to Inflation”, you can try these questions…a bit tougher for you.

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Indicator #1: Gross Domestic Product.  GDP is the single best quantitative measure of economic performance, but it does have limitations.  Use the resources below, along with classroom discussion and problems, to understand and work with this first concept.  As a basis, GDP is the total monetary value of all final goods and services produced within a nation (domestically).  It consists of four major segments of spending: C (consumers), I (business Investment),  G(government) and Nx (net exports, or the value of exports minus imports…trade balance).  Therefore we will talk a lot about the following formula: GDP = C+I+G+Nx.  Nx is also taught as X – M (exports minus imports).

GDP Work and Resources:  

GDP Packet – This packet will assist in your Ch. 23 summary.  Use it to cover the major concepts within GDP.  As well, there are practice problems we will complete in class.

GDP Simulation – An  introductory assignment into the different parts of GDP, both in monetary terms as well as percentages.  You will calculate GDP and GDP per capita for the fictional Island of Palau.

GDP Questions – These questions are from real US GDP data, both over a 10 year period, and for one quarter of GDP (3 months).  A bit tougher, but definitely need to be able to complete them.

GDP Study Cards – Here you will find about 50 practice questions all related to GDP and macroeconomics.  The questions are presented like flash cards, but the answers are on the bottom of each card.  Still a great study guide for the start of the unit.

Next up is video 5 – GDP…

Video 4: Supply and Demand Overview with Questions at End – This video covers the basics of supply and demand, and provides some tougher questions at the end for your to attempt.   Video is about 17 minutes long.

Supply and Demand Work:  Use the following activities and problem sets to help in your understanding of supply and demand.  Included are basic supply and demand problems, and articles related to price controls (price floors and price ceilings), the notion of “inferior goods”, and an article on price elasticity of demand.  Enjoy!

Supply and Demand Problem Set – Questions and problems related to supply and demand.  A good introduction in these essential economics concepts.

Is Bicycle Transportation an Inferior Good? – An article with questions related to changes in demand based on the notion of “inferior goods.”  Answer the questions that follow.

Government Price Controls in the Chinese Petrol Market – Another articles, including a graph, that analyzes the Chinese government’s involvement and control of the petrol market, including pricing and quantity.  Answer the questions that follow.

Heart Transplants and Watermelons: A Study of Elasticity – A third articles that discusses the price elasticity of demand of different products.

Video 3: More on the PPC (Production Possibilities Curve) – Part I

In this video, we will further explore the production possibilities curve by applying real examples of production, opportunity cost, and comparative advantage.  In the last video, we only looked at the concept of the PPC, whereas here, you will see numbers used with an example that centers on Berk and Saba – two Coffee and Doughnut producers.  As usual, email with questions…

The problem set from class was supposed to be challenging, but this video should help as you work through the questions that you started.  Use chapter 3 of the Mankiw textbook as well as a guide – that covers the potato farmer and cattle rancher example.

Just a heads up – this video is 30 minutes long!!! So, just watch the first 16 minutes now (concluding with the Berk and Saba example), and the rest later.

Video 2: Circular Flow Model and the Production Possibilities Curve

The video below will outline two of your first major models in economics: the circular flow model and the production possibilities curve.  You need to know and understand the models, but you will also have to analyze them when they are changed, or be able to manipulate them yourself based on economic data or trends.  Watch the video, and be ready to work through some problem sets in class based on the information presented.  The video is about 20 minutes.  Enjoy!!!

Video 1: Intro To Macroeconomics – Overview of the Syllabus

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