Inflation - SP Moodle
... • Most countries in the world publish a CPI which is a key economic indicator. • The consumer price index is sophisticated price indice. • Data is published monthly. • The CPI includes a range of goods and services. • This includes the cost to rent average home, the price of bus tickets, and a range ...
... • Most countries in the world publish a CPI which is a key economic indicator. • The consumer price index is sophisticated price indice. • Data is published monthly. • The CPI includes a range of goods and services. • This includes the cost to rent average home, the price of bus tickets, and a range ...
ADAS - YSU
... GDP , given price level is fixed – However, when real GDP , unit cost , so price level – Furthermore, as price level , Md and interest rate , which causes aggregate expenditure to decrease – In the end, real GDP increases by less than horizontal shift in AD curve ...
... GDP , given price level is fixed – However, when real GDP , unit cost , so price level – Furthermore, as price level , Md and interest rate , which causes aggregate expenditure to decrease – In the end, real GDP increases by less than horizontal shift in AD curve ...
AP Macroeconomics Unit III Fall 2011
... Types of Inflation • Cost – Push Inflation – Caused by increase in factors of production costs – Per unit production costs rise – Business must raise prices to make profits – “wage price spirals” as wages are the largest single production cost – Also caused by “supply shocks” (raw materials or ener ...
... Types of Inflation • Cost – Push Inflation – Caused by increase in factors of production costs – Per unit production costs rise – Business must raise prices to make profits – “wage price spirals” as wages are the largest single production cost – Also caused by “supply shocks” (raw materials or ener ...
Full Text - VNMPublication
... Supply-siders call for a decrease in tax rates. The aim of this is to encourage people to save more of their incomes, invest more and work harder. If saving is increased then interest rates would be low, which in turn would stimulate further growth and investment. In this way the aggregate supply of ...
... Supply-siders call for a decrease in tax rates. The aim of this is to encourage people to save more of their incomes, invest more and work harder. If saving is increased then interest rates would be low, which in turn would stimulate further growth and investment. In this way the aggregate supply of ...
Notes Inflation and Interest Rates in the Medium Run
... Higher interest rates reduce demand relative to the economy’s potential to supply goods and services. Reduce it enough, and unused slack will accumulate, forcing firms and workers to compete for scarce customers and jobs by lowering prices and wages. The opposite happens when demand rises relative t ...
... Higher interest rates reduce demand relative to the economy’s potential to supply goods and services. Reduce it enough, and unused slack will accumulate, forcing firms and workers to compete for scarce customers and jobs by lowering prices and wages. The opposite happens when demand rises relative t ...
Unit 3: Measuring Economic Performance
... – Total market value of all final goods and services produced by either citizen or foreign supplied resources within the country – Includes everything made in the US for final use – It is a monetary measure ($ value) ...
... – Total market value of all final goods and services produced by either citizen or foreign supplied resources within the country – Includes everything made in the US for final use – It is a monetary measure ($ value) ...
Objectives of the chapter - The Good, the Bad and the Economist
... Demand-pull inflation is most likely to occur if the economy is close to full employment. As consumers, businesses, foreigners and government increase their spending levels, total demand in the economy will begin to rise. If businesses are close to full capacity they will find it difficult to produc ...
... Demand-pull inflation is most likely to occur if the economy is close to full employment. As consumers, businesses, foreigners and government increase their spending levels, total demand in the economy will begin to rise. If businesses are close to full capacity they will find it difficult to produc ...
Ch. 10: Handout
... The lower the CPI , the higher purchasing power of nominal income The higher the CPI, the lower purchasing power of nominal income Therefore, those whose incomes increase at a higher rate than the rise in prices have a higher standard of living, visa versa Limitations of CPI 1. _____________________ ...
... The lower the CPI , the higher purchasing power of nominal income The higher the CPI, the lower purchasing power of nominal income Therefore, those whose incomes increase at a higher rate than the rise in prices have a higher standard of living, visa versa Limitations of CPI 1. _____________________ ...
IB Economics Scheme of Work for Macro
... (LRAS) is vertical at the level of potential output (full employment output) because aggregate supply in the long run is independent of the price level. • Explain, using a diagram that the Keynesian model of the aggregate supply curves has three sections because of “wage/price” downward inflexibilit ...
... (LRAS) is vertical at the level of potential output (full employment output) because aggregate supply in the long run is independent of the price level. • Explain, using a diagram that the Keynesian model of the aggregate supply curves has three sections because of “wage/price” downward inflexibilit ...
Macroeconomics, 6e (Abel et al.) Chapter 12 Unemployment and
... Question Status: Previous Edition ...
... Question Status: Previous Edition ...
the PDF File
... administered prices and inadequate growth of industrial production are some of the supply factors which cause inflation. ...
... administered prices and inadequate growth of industrial production are some of the supply factors which cause inflation. ...
202 course paper: 2001
... (ii) What factors determine the demand and supply for a currency? (iii) Distinguish between the price and output effects of a devaluation. (iv) Why might a devaluation worsen the current account in the short run? (v) What circumstances are required for a devaluation to work? (vi) Distinguish between ...
... (ii) What factors determine the demand and supply for a currency? (iii) Distinguish between the price and output effects of a devaluation. (iv) Why might a devaluation worsen the current account in the short run? (v) What circumstances are required for a devaluation to work? (vi) Distinguish between ...
Chapter 26 Business Cycles, Unemployment, and Inflation
... falling, which reduces spending, output, employment, and, in turn, the price level (a downward spiral). Inflation in modest amounts (<3%) is tolerable, although there is not universal agreement on this point. 8. Distinguish between demand-pull inflation and cost-push inflation. Which of the two type ...
... falling, which reduces spending, output, employment, and, in turn, the price level (a downward spiral). Inflation in modest amounts (<3%) is tolerable, although there is not universal agreement on this point. 8. Distinguish between demand-pull inflation and cost-push inflation. Which of the two type ...
Aggregate Supply and Demand
... Inverse relationship between Y and P as illustrated by downward sloping AD curve ...
... Inverse relationship between Y and P as illustrated by downward sloping AD curve ...
Phillips curve
In economics, the Phillips curve is a historical inverse relationship between rates of unemployment and corresponding rates of inflation that result in an economy. Stated simply, decreased unemployment, (i.e., increased levels of employment) in an economy will correlate with higher rates of inflation.While there is a short run tradeoff between unemployment and inflation, it has not been observed in the long run. In 1968, Milton Friedman asserted that the Phillips Curve was only applicable in the short-run and that in the long-run, inflationary policies will not decrease unemployment. Friedman then correctly predicted that, in the upcoming years after 1968, both inflation and unemployment would increase. The long-run Phillips Curve is now seen as a vertical line at the natural rate of unemployment, where the rate of inflation has no effect on unemployment. Accordingly, the Phillips curve is now seen as too simplistic, with the unemployment rate supplanted by more accurate predictors of inflation based on velocity of money supply measures such as the MZM (""money zero maturity"") velocity, which is affected by unemployment in the short but not the long term.