AP®︎ Macroeconomics Unit 3: Notes & Study Guide
Prepare for your quiz, test, or the AP exam with a comprehensive review on Unit 3 of AP Macroeconomics – National Income and Price Determination.
Unit 3: National Income and Price Determination
This unit analyzes national income and price levels through the lens of aggregate demand and supply, exploring how equilibrium is affected by policy and economic shocks.
Begin with Topic 3.1: Aggregate Demand (AD)To review Unit 3, go through each of the 9 topics below.
Everything you actually need to know for your Unit 3 test, pulled directly from the AP® Macroeconomics curriculum.
Aggregate Demand (AD)
Aggregate Demand (AD)
- What the Aggregate Demand Curve Is
- Why the AD Curve Slopes Downward
- Movement Along AD vs. Shifts of AD
Multipliers
Multipliers
- The Multiplier Effect
- Marginal Propensity to Consume and Save
- The Expenditure Multiplier
Short-Run Aggregate Supply (SRAS)
Short-Run Aggregate Supply (SRAS)
- What Short-Run Aggregate Supply Is
- Why the SRAS Curve Slopes Upward
- Shifts of the SRAS Curve
Long-Run Aggregate Supply (LRAS)
Long-Run Aggregate Supply (LRAS)
- What the Long Run Means in Macroeconomics
- What Long-Run Aggregate Supply Is
- LRAS and the Production Possibilities Curve
Equilibrium in the Aggregate Demand–Aggregate Supply (AD–AS) Model
Equilibrium in the Aggregate Demand–Aggregate Supply (AD–AS) Model
- Short-Run Equilibrium in the AD–AS Model
- Long-Run Equilibrium and Full Employment
- Output Gaps
Changes in the AD–AS Model in the Short Run
Changes in the AD–AS Model in the Short Run
- Short-Run Equilibrium in the AD–AS Model
- Aggregate Demand Shocks
- Short-Run Aggregate Supply Shocks
Long-Run Self-Adjustment
Long-Run Self-Adjustment
- Long-Run Equilibrium in the AD–AS Model
- Recessionary and Inflationary Gaps
- Self-Adjustment from a Recessionary Gap
Fiscal Policy
Fiscal Policy
- What Fiscal Policy Is
- How Fiscal Policy Shifts Aggregate Demand in the Short Run
- Spending and Tax Multipliers
Automatic Stabilizers
Automatic Stabilizers
- What Automatic Stabilizers Are
- The Main Types of Automatic Stabilizers
- How Automatic Stabilizers Moderate the Business Cycle
Notes
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