2. Uncle Sam wants y ou to do better in economics.

4. Eight Economic Goals 1. Economic Growth 6. Economic Freedom 3. Economic Efficiency 4. Price Level stability 5. Equal Distribution Of Income 7. Economic Security 2. Full Employment 8. Favorable Balance Of Trade

5. Real GDP Price Level AD 2 SRAS $510 Y F PL 1 LRAS E Full $20 Billion Increase in AD $5 Billion in additional government spending Or decrease T by $6.67 billion [M T of -3 x -$6.67 billion = $20 B]

6. 28% $183,250 Standard Deduction [$6,100-dependent] 0 28% Marginal Tax Rates I only have to pay the FICA tax. [$17,850-married filing jointly] [$12,750-HH] [8,925-single]

7. 20 % 10 % $50,000 Take that, you “low incomer.” I’m a “low incomer.”

8. And – how did former President George W. Bush do in college economics? Let’s take a look at his college transcript.

9. Econ 71/ 72 Gov. 73 /71 President Bush’s overall average 77 Kerry’s overall average 76. Gore’s average was even worse.

11. Major: Animal Science

12. “So - If you are having a hard time in economics, don’t worry about it. You are on schedule to be President of the U.S., or at least a governor.” One problem – he missed every 3 rd answer on tests.

13. SRAS 1 PL Y*Y*Y*Y* RGDP SRAS 2 103 AD 1 LRAS

14. AD PL 1 AQD 1 PL AQD

15. AS PL 1 AQS 1 There go some of my profits!

16. IgIg Corvette Ferrari Corvette Ferrari XNXN [ Exports-Imports] CPL AQD 1 AD 1 RDO

17. AQS 1 AQS 1 1. Lower business taxes 2. Decrease in regulations 3. Increase in subsidies You save money. We don’t require dental or medical insurance. You don’t have to pay us a pension and we don’t take sick days. And – we can dance. Anything that lowers the cost of production will shift AS right.

18. PL AD 2 LRAS SRAS RGDP SRAS PLSRAS AD 2 RGDP LRAS AD 1 SRAS Y* 800

20. Real GDP Price Level AD 2 SRAS $740 Y R $800 Y F PL 1 LRAS +60 “M” = Y/ E = 60/15 = 4 Full $60 Billion Increase in AD

21. Real GDP Price Level AD 2 SRAS $800 Y F PL 1 LRAS E +60 Recess. Gap Full $60 Billion Increase in AD