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Macroeconomics 1012-C: Key Concepts and Review Notes

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Circular Flow Diagram

Nominal GDP and Real GDP

Aggregate Demand

Short Run Aggregate Supply

Long Run Aggregate Supply

The Consumption Function

Government Purchases and the Multiplier Effect

Taxes, the Multiplier Effect, and Automatic Stabilizers

Introduction to Fiscal Policy

Goals of Monetary Policy

The Demand for Money

Monetary Policy and Aggregate Demand

Expansionary and Contractionary Monetary Policy