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Midterm

ECO102H1 Study Guide - Midterm Guide: Output Gap, Government Budget Balance, Allocative Efficiency


Department
Economics
Course Code
ECO102H1
Professor
James Pesando
Study Guide
Midterm

This preview shows pages 1-2. to view the full 6 pages of the document.
[ECO100 ECONOMICS]
TERM TEST #3 REVIEW
Review: Externalies


 !"
#$%&'( )
" *+ 
,,
" - %.'/( .%'.
%,,/)
*Third party: tax payers get benet because less of their taxes are used in health care
0" - 1/(.),2,.% '
3.4
5" ., '.
-,
No externality in producon (SS),
therefore, private cost = social cost
667
887
879(. )3:9.4
. 
" & %/.,% , , ! 
3674"
" ;,3.42,,,3.4
 ,,,% ,  
!. %/."
<.
,3.4 ,,,:2,,
 ,:,3,:,.4"
,3.4 ,, ,:2,,
,:,3,:,.4"

Only pages 1-2 are available for preview. Some parts have been intentionally blurred.

[ECO100 ECONOMICS]
Review: Naonal Income Accounts
) =.'->8( .') ? 
(,')
) :(if outside market, not included)
EX. @2,2,->8=
,2,,A;/()
,2.,=/
,2.,/B
+2
/B3 '%49/3=4C/

2.D.%E/%.,,%
%"
EX.F,F,, ,2,22:"F,F/0
, ,2:2,F,,22:"+F,7
,F,
+2<->8./0
<->8(GH):

,. ,%,%,,->89:"
Review: Macro Model with Fixed Prices
(A')
(->8)>8G *
;$
@,=
*
+%%%#(+#)=I
#$
+
- (-)
()
#(J)
($)
+#C=II-I(J9$)
<
" #K.(H)
+#CH
>%C
%,( )  L
*Undesired (unplanned) $uctuaons in inventory investment cause rms to change producon
Undesired inventory investment (actual sales < planned sales)
reduce producon
Undesired inventory disinvestment (actual sales > planned sales)
expand producon
" $
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