Operation: FRQ FRQ EDITION

2014 FRQ Assume that the United States economy is currently operating below the full-employment level of real domestic product with a balanced budget. (a) Draw a correctly labeled graph of aggregate demand, short-run aggregate supply, and long-run aggregate supply, and show each of the following in the United States. (i) Current output and price level, labeled Y1 and PL1, respectively (ii) Full employment output, labeled as Yf

2014 FRQ Assume that the United States economy is currently operating below the full-employment level of real domestic product with a balanced budget. (a) Draw a correctly labeled graph of aggregate demand, short-run aggregate supply, and long-run aggregate supply, and show each of the following in the United States. (i) Current output and price level, labeled Y1 and PL1, respectively (ii) Full employment output, labeled as Yf

Instructions: Go through the FRQ packet and highlight, circle or underline functional vocabulary (necessary econ words or phrases). Focus on topics we’ve discussed during the first quarter.

What’s it talking about? Vocab Term What’s it talking about? Synonyms Symbols & Acronyms Graph Problem (π / U%) Solution (policy?) Formulas Below full-employment level of real domestic product

What’s it talking about? Vocab Term What’s it talking about? Synonyms Symbols & Acronyms Graph Problem (π / U%) Solution (policy?) Formulas Below full-employment level of real domestic product AD/AS Gross domestic product Recession Contraction GDPr GDP = C Ig G Xn W R I P U% AD/AS intersect to left of LRAS PPF Business cycle U% Exp. fiscal policy (grow the economy) GDPr = (nominal GDP / CPI) x 100 CPI = (Current price / base price) x 100

Instructions: Using the interwebs, find the real definition and supporting info for each term to fill out your study chart. Go to McFarling’s webpage Select “AP Econ EXAM STUDY”