Interactive study labs for the AP Macroeconomics course, one for each topic. Each lab has graphs you can move, a running explanation of what changed and why, a reference table, FRQ tips, practice questions, and the key terms for that topic.
Every key term in the course, with search, flashcards, and a self-quiz.
Scarcity means our wants are unlimited but the resources to satisfy them are limited, so every person and every society has to choose.
Open lab → Topic 1.2Every choice has an opportunity cost: the next best thing you give up.
Open lab → Topic 1.3A country has a comparative advantage in a good when it can make that good at a lower opportunity cost than another country.
Open lab → Topic 1.4Demand shows how much of a good buyers are willing and able to buy at each price.
Open lab → Topic 1.5Supply shows how much sellers are willing and able to offer at each price.
Open lab → Topic 1.6A market is in equilibrium when quantity demanded equals quantity supplied.
Open lab →The circular flow model shows how money, products, and resources move between households, firms, the government, and the rest of the world.
Open lab → Topic 2.2GDP measures the market value of final goods and services produced inside a country in a year.
Open lab → Topic 2.3The unemployment rate counts people who have no job and are actively looking, as a share of the labor force.
Open lab → Topic 2.4A price index like the consumer price index (CPI) tracks what a fixed market basket of goods costs over time, compared with a base year set to 100.
Open lab → Topic 2.5Inflation erodes the purchasing power of money, and when it is unanticipated it moves purchasing power from some people to others.
Open lab → Topic 2.6Nominal GDP values output at the prices of the year it was produced, so it rises when prices rise even if the economy makes nothing extra.
Open lab → Topic 2.7Real GDP does not grow in a straight line.
Open lab →Aggregate demand (AD) is the total amount of real GDP that households, firms, the government, and foreign buyers want to buy at each price level: AD = C + I + G + Xn.
Open lab → Topic 3.2One person's spending is another person's income, so a change in spending ripples through the economy and changes real GDP by more than the first dollar spent.
Open lab → Topic 3.3Short-run aggregate supply (SRAS) shows how much real GDP firms produce at each price level while nominal wages and some other input prices are still stuck.
Open lab → Topic 3.4Long-run aggregate supply (LRAS) shows how much real GDP the economy produces once every price and wage has adjusted.
Open lab → Topic 3.5Short-run equilibrium is where aggregate demand crosses short-run aggregate supply.
Open lab → Topic 3.6A shock to aggregate demand or short-run aggregate supply moves the economy away from full employment.
Open lab → Topic 3.7When AD shifts, the economy can land in a recessionary or inflationary gap.
Open lab → Topic 3.8Fiscal policy is the government's use of spending, taxes, and transfer payments to shift aggregate demand.
Open lab → Topic 3.9Automatic stabilizers are tax and transfer rules that push against the business cycle on their own, with no new law.
Open lab →People store wealth in financial assets such as cash, bank deposits, bonds, and stocks, and each one trades off liquidity, rate of return, and risk.
Open lab → Topic 4.2The nominal interest rate is the rate written on the loan.
Open lab → Topic 4.3Money is any asset people widely accept as payment.
Open lab → Topic 4.4Banks keep only a fraction of their deposits as reserves and lend out the rest, and those loans create new money.
Open lab → Topic 4.5The money market is where the demand for money meets the supply of money set by the central bank, and together they determine the nominal interest rate.
Open lab → Topic 4.6Monetary policy is how the central bank changes interest rates to push aggregate demand toward full employment and stable prices.
Open lab → Topic 4.7The loanable funds market brings together savers, who supply funds, and borrowers, who demand them.
Open lab →Congress controls fiscal policy (government spending and taxes).
Open lab → Topic 5.2The Phillips curve shows the trade-off between inflation and unemployment.
Open lab → Topic 5.3In the long run, inflation is driven by how fast the money supply grows.
Open lab → Topic 5.4A budget deficit is what the government is short in one year.
Open lab → Topic 5.5When the government borrows to cover a budget deficit, it competes with businesses for the same pool of saving.
Open lab → Topic 5.6Economic growth means the economy can produce more than before.
Open lab → Topic 5.7Some policies only push aggregate demand.
Open lab →The balance of payments records every transaction between a country's residents and the rest of the world.
Open lab → Topic 6.2An exchange rate is the price of one currency in terms of another.
Open lab → Topic 6.3In the foreign exchange market, people trade one currency for another so they can buy goods, services, and assets from another country.
Open lab → Topic 6.4The value of the dollar moves when something changes how many dollars foreigners want to buy or how many dollars Americans want to sell.
Open lab → Topic 6.5When the dollar's value changes, the prices of U.S.
Open lab → Topic 6.6Financial capital flows toward the country that pays the higher real interest rate.
Open lab →