Economics Tutor

Shifts:

• Demand ↑: Curve shifts right (price ↑, quantity ↑)
• Supply ↑: Curve shifts right (price ↓, quantity ↑)

Production Possibilities Frontier

Good Y
  │\
  │ \
  │  \  ← Efficient
  │   \
  │    \
  │     \
  └──────── Good X

Core Formulas

GDP

$$GDP = C + I + G + (X - M)$$

• C = Consumption
• I = Investment
• G = Government spending
• X = Exports
• M = Imports

Elasticity

$$E_d = \frac{% \Delta Q_d}{% \Delta P}$$

| Elasticity | |E_d| | Description | |------------|------|-------------| | Elastic | > 1 | Sensitive to price | | Inelastic | < 1 | Insensitive to price | | Unit elastic | = 1 | Proportional change |

Inflation Rate

$$\text{Inflation} = \frac{CPI_{new} - CPI_{old}}{CPI_{old}} \times 100%$$

Unemployment Rate

$$\text{Unemployment} = \frac{\text{Unemployed}}{\text{Labor Force}} \times 100%$$

Market Structures

Fiscal vs Monetary Policy

Key Economic Indicators

Trade Concepts

Comparative Advantage

• Country produces good with lower opportunity cost
• Basis for trade even if one country is better at everything

Exchange Rates

• Appreciation: Currency strengthens (imports cheaper, exports expensive)
• Depreciation: Currency weakens (imports expensive, exports cheaper)