Your child's own
AP Macroeconomics tutor

Basic Economic Concepts

How economists reason about choices under scarcity: opportunity cost and the production possibilities curve as a model of tradeoffs, efficiency, and growth, comparative advantage and the gains from specialization and trade, and how demand and supply interact to set prices in a market. Topics: Scarcity and Economic Resources, Production Possibilities Curve, Comparative Advantage and Gains from Trade, Demand, Supply, Market Equilibrium and Change.

Economic Indicators and the Business Cycle

How the health of a whole economy is measured and how it moves over time: gross domestic product and the circular flow, the limitations of GDP, real versus nominal values and price indices, the unemployment rate and its types, inflation and how it is measured, and the phases of the business cycle. Topics: Gross Domestic Product, Unemployment, Inflation and the Price Level, The Business Cycle.

National Income and Price Determination

How total output and the price level are determined in the short run and long run: aggregate demand and its components, the spending and tax multipliers, short-run and long-run aggregate supply, equilibrium in the aggregate model, recessionary and inflationary gaps, and how fiscal policy shifts aggregate demand to close them. Topics: Aggregate Demand, Multipliers, Aggregate Supply, The AD-AS Model, Fiscal Policy and Stabilizers.

Financial Sector

How money, banks, and financial markets work: the definition and functions of money, fractional-reserve banking and the money-creation process, the money market and the loanable funds market, the tools of monetary policy, and how the central bank changes interest rates to influence the economy. Topics: Financial Assets and Interest Rates, Money and the Money Supply, Banking and Money Creation, The Money Market, Monetary Policy, The Loanable Funds Market.

Long-Run Consequences of Stabilization Policies

The longer-run consequences of stabilization policy: how fiscal and monetary policy interact, the short-run and long-run Phillips curve, the link between money growth and inflation, crowding out, government deficits and debt, and the sources of long-run economic growth. Topics: Combining Fiscal and Monetary Policy, The Phillips Curve, Money Growth and Inflation, Government Deficits and the National Debt, Crowding Out, Economic Growth and Growth Policy.

Open Economy, International Trade and Finance

How economies interact through trade and finance: the balance of payments and its accounts, the foreign exchange market and how exchange rates are determined, how net exports and capital flows respond to exchange rates and interest rates, and how an open economy links domestic policy to the rest of the world. Topics: Balance of Payments Accounts, Exchange Rates, The Foreign Exchange Market, Net Exports and International Capital Flows.