Download AP Macro Economics

AP Macro Economics
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Weeks 1-3: An Introduction to Economics and the Economy
• Basic Economic Concepts (AP 1)
• Scarcity, choice and opportunity cost (AP 1a)
• Production possibilities curve (AP 1b)
• Comparative advantage, absolute advantage, specialization and exchange (AP 1c)
• Demand, supply and market equilibrium (AP 1d)
• Macroeconomic issues: business cycle, unemployment, inflation, growth (AP1e)
• analyze the economic rights and responsibilities of businesses, including those involved in starting a small
business.[16C]
• explain how corporations raise money through stocks and bonds.[16D]
• analyze the costs and benefits of the purchase, use, or disposal of personal and business property.[7A]
• identify and evaluate examples of restrictions that the government places on the use of business and individual
property.[7B]
• explain the basic characteristics of the U.S. free enterprise system, including private property, incentives,
economic freedom, competition, and the limited role of government.[6A]
• explain the benefits of the U.S. free enterprise system, including individual freedom of consumers and
producers, variety of goods, responsive prices, investment opportunities, and the creation of wealth.[6B]
• analyze recent changes in the basic characteristics of the U.S. economy.[6C]
• analyze the costs and benefits of U.S. economic policies related to the economic goals of economic growth,
stability, full employment, freedom, security, equity (equal opportunity versus equal outcome), and efficiency.[6D]
• explain why scarcity and choice are basic economic problems faced by every society.[1A]
• interpret a production-possibilities curve and explain the concepts of opportunity costs and scarcity.[1D]
• describe the basic characteristics of economic systems, including property rights, incentives, economic freedom,
competition, and the role of government.[5A]
• identify economic concepts in the U.S. Constitution, including property rights and taxation.[14A]
• describe the role of government in the U.S. free enterprise system and the changes in that role over time.[14B]
• evaluate government rules and regulations in the U.S. free enterprise system.[14C]
• identify types of taxes at the local, state, and national levels and the economic importance of each.[15A]
• analyze the importance of various economic philosophers, including Friedrich Hayek, Milton Friedman, John
Maynard Keynes, and Adam Smith, and their impact on the U.S. free enterprise system.[5E]
• describe how societies answer the basic economic questions.[1B]
• analyze economic information by sequencing, categorizing, identifying cause-and-effect relationships,
comparing, contrasting, finding the main idea, summarizing, making generalizations and predictions, and drawing
inferences and conclusions.[21A]
• create economic models, including production-possibilities curves, circular-flow charts, and supply-and-demand
graphs, to analyze economic concepts or issues.[21B]
• explain a point of view on an economic issue.[21C]
• evaluate economic data using charts, tables, graphs, and maps.[21E]
• use appropriate mathematical skills to interpret economic information.[21F]
• use economic-related terminology correctly.[22A]
• use standard grammar, spelling, sentence structure, and punctuation.[22B]
• transfer information from one medium to another, including written to visual and statistical to written or visual,
using computer software as appropriate.[22C]
• create written, oral, and visual presentations of economic information.[22D]
• attribute ideas and information to source materials and authors.[22E]
• use a problem-solving process to identify a problem, gather information, list and consider options, consider
advantages and disadvantages, choose and implement a solution, and evaluate the effectiveness of the solution.
[23A]
• use a decision-making process to identify a situation that requires a decision, gather information, identify
options, predict consequences, and take action to implement a decision.[23B]
• analyze how productivity relates to growth.[11A]
• analyze how technology relates to growth.[11B]
• analyze how trade relates to growth.[11C]
Essential Questions
• What is the economic way of thinking?
• What are the basic problems in economics?
• What characterizes the American economic system?
• How do the public and private sectors interact?
Weeks 4-6: An Introduction to Economics and the Economy; International Economics and the World Economy
• Basic Economic Concepts (AP 1)
• Scarcity, choice and opportunity cost (AP 1a)
• Production possibilities curve (AP 1b)
• Comparative advantage, absolute advantage, specialization and exchange (AP 1c)
• Demand, supply and market equilibrium (AP1d)
• Macroeconomic issues: business cycle, unemployment, inflation, growth (AP1e)
• Open Economy: International Trade and Finance (AP 7)
• Balance of payments accounts (AP 7a)
• Balance of trade (AP 7ai)
• Current account (AP 7aii)
• Capital account (AP 7aiii)
• Foreign exchange market (AP 7b)
• Demand for and supply of foreign exchange (AP 7bi)
• Exchange rate determination (AP 7bii)
• Currency appreciation and depreciation (AP 7biii)
• Net exports and capital flows (AP 7c)
• Links to financial and goods markets (AP 7d)
• describe the economic factors of production.[1C]
• understand the effect of changes in price on the quantity demanded and quantity supplied.[2A]
• identify the non-price determinants that create changes in supply and demand, which result in a new equilibrium
price.[2B]
• interpret a supply-and-demand graph using supply-and-demand schedules.[2C]
• explain the concepts of absolute and comparative advantages.[3A]
• apply the concept of comparative advantage to explain why and how countries trade.[3B]
• analyze the impact of U.S. imports and exports on the United States and its trading partners.[3C]
Essential Questions
• How do the interactions of buyers and sellers determine prices?
• What is the economic basis of free trade?
• How does foreign exchange work?
• What is the significance of the balance of payments between nations?
Weeks 7-9: National Income and Employment
• Measurement of Economic Performance (AP 2)
• National income accounts (AP 2a)
• Circular flow (AP 2ai)
• Gross domestic product (AP 2aii)
• Components of gross domestic product (AP 2aIII)
• Real versus nominal gross domestic product (AP 2aiv)
• Inflation measurement and adjustment (AP 2b)
• Price indices (AP 2bi)
• Nominal and real values (AP 2bii)
• Costs of inflation (AP 2biii)
• Unemployment (AP 2c)
• Definition and measurement (AP 2ci)
• Types of unemployment (AP 2cii)
• Natural rate of unemployment (AP 2ciii)
• National Income and Price Determination (AP 3)
• Aggregate demand (AP 3a)
• Determinants of aggregate demand (AP 3ai)
• Multiplier and crowding-out effects (AP 3aii)
• Aggregate supply (AP 3b)
• Short-run and long-run analyses (AP 3bi)
• Sticky versus flexible wages and prices (AP 3bii)
• Determinants of aggregate supply (AP 3biii)
• Macroeconomic equilibrium (AP 3c)
• Real output and price level (AP 3ci)
• Short and long run (AP 3cii)
• Actual versus full-employment output (AP 3ciii)
• Economic fluctuations (AP 3civ)
• interpret economic data, including unemployment rate, gross domestic product, gross domestic product per
capita as a measure of national wealth, and rate of inflation.[10A]
• analyze business cycles using key economic indicators.[10B]
• explain the structure of the Federal Reserve System.[13A]
• analyze the three basic tools used to implement U.S. monetary policy, including reserve requirements, the
discount rate and the federal funds rate target, and open-market operations.[13B]
• explain how the actions of the Federal Reserve System affect the nation's money supply.[13C]
• analyze the decline in value of the U.S. dollar, including the abandonment of the gold standard.[13D]
Essential Questions
• How do you measure economic performance?
• What are the major threats to economic growth and stability?
• How are prices determined in aggregate markets?
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Weeks 10-12: Fiscal Policy, Money, and Banking
• Financial Sector (AP 4)
• Money, banking, and financial markets (AP 4a)
• Definition of financial assets: money, stocks, bonds (AP 4ai)
• Time value of money (present and future value) (AP 4aii)
• Measures of money supply (AP 4aiii)
• Banks and creation of money (AP 4aiv)
• Money demand (AP 4av)
• Money market (AP 4avi)
• Loanable funds market (AP 4avii)
• Central bank and control of the money supply (AP 4b)
• Tools of central bank policy (AP 4b)
• Tools of central bank policy (AP 4bi)
• Quantity theory of money (AP 4bii)
• Real versus nominal interest rates (AP 4biii)
• Inflation, Unemployment, and Stabilization Policies (AP 5)
• Fiscal and monetary policies (AP 5a)
• Demand-side effects (AP 5ai)
• Supply-side effects (AP 5aii)
• Policy mix (AP 5aiii)
• Government deficits and debt (AP 5aiv)
• Inflation and unemployment (AP 5b)
• Types of inflation (AP 5bi)
• Demand-pull inflation (AP 5bia)
• Cost-push inflation (AP 5bib)
• The Phillips curve: short run versus long run (AP 5bii
• Role of expectations (AP 5biii)
• compare the free enterprise system, socialism, and communism using the basic characteristics of economic
systems.[5B]
• examine current examples of free enterprise, socialist, and communist economic systems.[5C]
• understand that the terms free enterprise, free market, and capitalism are synonymous terms to describe the
U.S. economic system.[5D]
• interpret the roles of resource owners and firms in a circular-flow model of the economy and provide real-world
examples to illustrate elements of the model.[8A]
• explain how government actions affect the circular-flow model.[8B]
• explain how the circular-flow model is affected by the rest of the world.[8C]
• describe characteristics and give examples of pure competition, monopolistic competition, oligopoly, and
monopoly.[9A]
• identify and evaluate ordinances and regulations that apply to the establishment and operation of various types
of businesses.[9B]
• analyze the categories of revenues and expenditures in the U.S. federal budget.[15B]
• analyze the impact of fiscal policy decisions on the economy.[15C]
• explain the characteristics of sole proprietorships, partnerships, and corporations.[16A]
• analyze the advantages and disadvantages of sole proprietorships, partnerships, and corporations.[16B]
• explain the functions of financial institutions and how they affect households and businesses.[17A]
• explain how the amount of savings in an economy is the basis of capital formation.[17B]
• analyze the role of interest and risk in allocating savings to its most productive use.[17C]
• examine the types of accounts available to consumers from financial institutions and the risks, monetary costs,
and benefits of maintaining these accounts.[17D]
Essential Questions
• How does Fiscal Policy work?
• What is the role of money in economic systems?
• How do banks and thrifts create money?
Weeks 13-15: Monetary Policy, Long-Run Perspectives, and Macroeconomic Debates
• Inflation, Unemployment, and Stabilization Policies (AP 5)
• Fiscal and monetary policies (AP 5a)
• Demand-side effects (AP 5ai)
• Supply-side effects (AP 5aii)
• Policy mix (AP 5aiii)
• Government deficits and debt (AP 5aiv)
• Inflation and unemployment (AP 5b)
• Types of inflation (AP 5bi)
• Demand-pull inflation (AP 5bia)
• Cost-push inflation (AP 5bib)
• The Phillips curve: short run versus long run (AP 5bii)
• Role of expectations (AP 5biii)
Essential Questions
• How does Monetary policy work?
• What is the long run?
• What are the Phillips and Laffer curves?
Weeks 16-18: Long-Run Perspectives and Macroeconomic Debates
• Economic Growth and Productivity (AP 6)
• Investment in human capital (AP 6a)
• Investment in physical capital (AP 6b)
• Research and development, and technological progress (AP 6C)
• Growth policy (AP 6d)
Essential Questions
• What are the major ingredients for economic growth?
• How is the public debt created?
• What are the major schools of economic thought?
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TEKS
• compare the effects of free trade and trade barriers on economic activities.[4A]
• evaluate the benefits and costs of participation in international free-trade agreements.[4B]
• analyze the effects of changes in exchange rates on imports and exports.[4C]
• describe the functions of money.[12A]
• describe the characteristics of money, including commodity money, fiat money, and representative money.[12B]
• examine the positive and negative aspects of barter, currency, credit cards, and debit cards.[12C]
• assess ways to be a wise investor in the stock market and in other personal investment options.[18A]
• explain how to begin a savings program.[18B]
• examine investment options available in a personal retirement plan.[18C]
• demonstrate how to maintain a checking account, including reconciling a bank statement.[18D]
• identify the types of loans available to consumers.[18E]
• explain the responsibilities and obligations of borrowing money.[18F]
• develop strategies to become a low-risk borrower by improving one's personal credit score.[18G]
• examine ways to avoid and eliminate credit card debt.[19A]
• evaluate the costs and benefits of declaring personal bankruptcy.[19B]
• evaluate the costs and benefits of buying insurance.[19C]
• evaluate the costs and benefits of charitable giving.[19D]
• evaluate the costs and benefits of renting a home.[20A]
• evaluate the costs and benefits of buying a home.[20B]
• assess the financial aspects of making the transition from renting to home ownership.[20C]
• analyze and evaluate the validity of economic information from primary and secondary sources for bias,
propaganda, point of view, and frame of reference.[21D]