Overview Booklet: AS AQA Econ2 'Macroeconomics'

This is a start-from-scratch guide to economics.

It explains all the long words, makes things easy and plain to understand.

Memorising this will help you gain a C/B grade. There is some A grade detail but not a lot - I wanted to keep it as a basic guide.

Hope it helps. I struggled with economics to start with, but having notes which relate to each other makes the whole topic much much easier.

Enjoy :)

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Econ2: Macroeconomics

Economic Performance Indicators
Gross Domestic Product (GDP)
Gross Net Product (GNP)
Purchasing Power Parity (PPP)
Human Development Index (HDI)
The Economic Cycle
What is an economic cycle?
Output Gaps

Economic Growth
Benefits of Economic Growth: Why is it important?
The Multiplier Effect
The Accelerator Effect

The Circular…

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Economic Performance Indicators
Gross Domestic Product (GDP)
The gross domestic product is a measure of the total domestic economic activity. It is the sum of
incomes earned by the production of goods and services on the country's economic territory. It is
often positively correlated with the standard of living however…

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literacy is tested in different languages to different levels. Because of these weaknesses the HDI
scale is a relative measure not an absolute score.

The Economic Cycle
What is an economic cycle?
The economic cycle is a series of fluctuations in production or economic activity over several
months or years.…

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Economic Growth
Economic growth is an increase in GDP (Gross Domestic Product).

Benefits of Economic Growth: Why is it important?
Economic growth is an increase in output. This means the country is producing more, which is a
good thing. Also, a growth in GDP is associated with better living standards…

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The Accelerator Effect

This principle describes that how business' expenditure on capital investment will be
influenced by the speed demand is growing for its products.
For example, remember Terry, who's just been made redundant because Vauxhall shut down its
plant? Well, he's started a business selling novelty flower pots. In…

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The Circular Flow of Income
The circular flow of income is a model which explains what determines the equilibrium
level of national income.
It's the idea that money transfers between businesses, consumers and other countries.


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Aggregate Demand
The sum of all planned spending on domestic output at a given general price level per period.

Aggregate demand is the total demand for all goods and services in an economy. It is made up of
Consumption, Investment, Government spending and the difference between exports and imports.


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Expectations & business If a business thinks moving to a larger site will benefit the
plans company in the long term they are likely to go ahead with this
decision, depending on all of the other determinants.

Government Spending
The government spends money on defence, education, healthcare and transport. Different…

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exports and imports is elastic there will be a fall in the volume of
exports and a rise in the volume of imports.

The Diagram for Aggregate Demand
The aggregate demand curve demonstrates how price and
demand are related. Usually, as prices go up demand falls.
A fall in the…

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Aggregate Supply
The sum of all planned output companies are willing to produce at each price level.

Short Run Aggregate Supply
Short run aggregate supply (SRAS) is the output supplied in a time
period when the prices of inputs, including labour and raw
materials, remain unchanged.

The SRAS curve slopes…


Dan Lindsay


cheers bbz xoxo

Oyejoke Balogun


thank you soooo much, i appreciate this.



This is a vey well written 18 page summary covering macroeconomics up to AS level. Covers the indicators well.



Thank you very much for this doc. very kind of you.

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