GDP
... Okun’s Law: When unemployment rises 1 percent above the natural rate, GDP falls by about 2 percent ...
... Okun’s Law: When unemployment rises 1 percent above the natural rate, GDP falls by about 2 percent ...
Unemployment handout
... some individuals are in-between jobs (frictional unemployment), just entering the labor force (frictional unemployment), or forced out of a job due to technological or other change (structural unemployment) in the industry . Because these changes are inevitable in a free economy and to some degree d ...
... some individuals are in-between jobs (frictional unemployment), just entering the labor force (frictional unemployment), or forced out of a job due to technological or other change (structural unemployment) in the industry . Because these changes are inevitable in a free economy and to some degree d ...
Aggregate Demand/Aggregate Supply
... exports and we import more things from abroad: NX falls. •Wealth Effect: When our price level rises, the real value of our monetary wealth (M/P) declines. We feel poorer and spend less: C falls . In addition, when our price level rises and real money balances (M/P) become scarcer, our interest rate ...
... exports and we import more things from abroad: NX falls. •Wealth Effect: When our price level rises, the real value of our monetary wealth (M/P) declines. We feel poorer and spend less: C falls . In addition, when our price level rises and real money balances (M/P) become scarcer, our interest rate ...
Part and/or Chapter Number and Title
... Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved ...
... Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved ...
View/Open
... not more so for a young man to start in farming. 2. Wages and the Cost of Living. There generally tends to be a lag in wages behind the cost of living in times of inflation. As labor becomes more organized and powerful they move to offset this and some sectors of organized labor may lead the inflati ...
... not more so for a young man to start in farming. 2. Wages and the Cost of Living. There generally tends to be a lag in wages behind the cost of living in times of inflation. As labor becomes more organized and powerful they move to offset this and some sectors of organized labor may lead the inflati ...
Global inflation: how big a threat?
... In this speech,(1) Andrew Sentance,(2) a member of the Monetary Policy Committee, discusses the origins of the recent change in the global inflation climate, whether the change in trend is likely to be sustained and the implications for monetary policy. He highlights the stronger inflationary impetu ...
... In this speech,(1) Andrew Sentance,(2) a member of the Monetary Policy Committee, discusses the origins of the recent change in the global inflation climate, whether the change in trend is likely to be sustained and the implications for monetary policy. He highlights the stronger inflationary impetu ...
Pre-Test Chap 12 Handout Page
... In the Keynesian view, demand shocks are the most likely cause of business cycles because (a) savings was determined by changes in personal income, rather than interest rates. (b) technology does not usually change rapidly and annual productivity growth is low. (c) there are far more possible causes ...
... In the Keynesian view, demand shocks are the most likely cause of business cycles because (a) savings was determined by changes in personal income, rather than interest rates. (b) technology does not usually change rapidly and annual productivity growth is low. (c) there are far more possible causes ...
Michael Bruno Working Paper 1050
... a quasi—Phillips—curve framework (Figure 1). Rather than plot unemployment rates (which mean little in the present context), we use deviations from mean SOP growth during 1964—Si as our ...
... a quasi—Phillips—curve framework (Figure 1). Rather than plot unemployment rates (which mean little in the present context), we use deviations from mean SOP growth during 1964—Si as our ...
DEVIRING THE AGGREGATE SUPPLY CURVES
... Long-run aggregate supply can change for two reasons: Change in labour supply Change in labour productivity An increase in the population increases the labour force and increases the supply of labour. An increased supply of labour brings a fall in the real wage rate, an increase in employment, an ...
... Long-run aggregate supply can change for two reasons: Change in labour supply Change in labour productivity An increase in the population increases the labour force and increases the supply of labour. An increased supply of labour brings a fall in the real wage rate, an increase in employment, an ...
Slides for Chapter 9 - the School of Economics and Finance
... Politicians often like to point to a “falling labor force participation rate” as a strongly negative sign for the economy. • Is this necessarily true? The two major reasons why the LFPR for men has fallen over the last several decades are: • Men have been going to school for longer and retiring earl ...
... Politicians often like to point to a “falling labor force participation rate” as a strongly negative sign for the economy. • Is this necessarily true? The two major reasons why the LFPR for men has fallen over the last several decades are: • Men have been going to school for longer and retiring earl ...
Inflation and deflation
... If we assume that the economy is near full employment, then the increase in aggregate demand results in an increase in demandpull inflation as the price level rises from P1 to P2, as shown in movement (1) in Figure 19.5. The diagram shows what may happen next. The higher price level means that costs ...
... If we assume that the economy is near full employment, then the increase in aggregate demand results in an increase in demandpull inflation as the price level rises from P1 to P2, as shown in movement (1) in Figure 19.5. The diagram shows what may happen next. The higher price level means that costs ...
Eco220Int Subject Ou.. - CSUSAP
... texts on macroeconomics. It has been selected because this is the focus intended in this subject. Although not an Australian text, it is more globally focused than most US publications. Its author, Olivier Blanchard, is an internationally renowned macroeconomist who although based in the US, has a b ...
... texts on macroeconomics. It has been selected because this is the focus intended in this subject. Although not an Australian text, it is more globally focused than most US publications. Its author, Olivier Blanchard, is an internationally renowned macroeconomist who although based in the US, has a b ...
Aggregate Supply and the Price Level
... changed relative to the price of other goods in the economy. These agents will discover that they have made incorrect production decisions (i.e., overproduced) and make the necessary corrections. This involves an upward revision of their price expectations (Pt = E[Pt]) and a reduction in output (B t ...
... changed relative to the price of other goods in the economy. These agents will discover that they have made incorrect production decisions (i.e., overproduced) and make the necessary corrections. This involves an upward revision of their price expectations (Pt = E[Pt]) and a reduction in output (B t ...
Equilibrium in the Aggregate Demand
... causes the market to price to rise When there is a surplus, the good causes its market price to fall Both ensures that the market reaches equilibrium Same for short-run macroeconomic equilibrium Aggregate price level is above it equilibrium level, ...
... causes the market to price to rise When there is a surplus, the good causes its market price to fall Both ensures that the market reaches equilibrium Same for short-run macroeconomic equilibrium Aggregate price level is above it equilibrium level, ...
Unemployment - Business @ UOW
... The NAIRU model of unemployment uses the adaptive expectations mechanism. Hence, it is assumed here, that once the rate of inflation increases, higher inflationary expectations will feed into higher money wage growth as workers seek to maintain their real wages. This in turn gives rise to further in ...
... The NAIRU model of unemployment uses the adaptive expectations mechanism. Hence, it is assumed here, that once the rate of inflation increases, higher inflationary expectations will feed into higher money wage growth as workers seek to maintain their real wages. This in turn gives rise to further in ...
Bank of England Inflation Report May 2012
... Charts 5.6 and 5.7 depict the probability of various outcomes for CPI inflation in the future. Chart 5.6 is conditioned on the assumption that the stock of purchased assets financed by the issuance of central bank reserves remains at £325 billion throughout the forecast period. Chart 5.7 was conditi ...
... Charts 5.6 and 5.7 depict the probability of various outcomes for CPI inflation in the future. Chart 5.6 is conditioned on the assumption that the stock of purchased assets financed by the issuance of central bank reserves remains at £325 billion throughout the forecast period. Chart 5.7 was conditi ...
AP-Macro-Unit-4-Summary-2
... • What is the nominal and what is the real interest rate? • The Nominal interest rate is 20% • The Real interest rate was only 5% • In reality, you get paid back an amount with less purchasing power. Nominal Interest Rates- the percentage increase in money that the borrower pays including inflation. ...
... • What is the nominal and what is the real interest rate? • The Nominal interest rate is 20% • The Real interest rate was only 5% • In reality, you get paid back an amount with less purchasing power. Nominal Interest Rates- the percentage increase in money that the borrower pays including inflation. ...
General Equilibrium and IS-LM 1. Some points about IS
... • Anything that shifts the saving curve or the investment curve in the saving-investment market, other than changes in Y , shifts the IS curve. • Anything that shifts the investment curve out in the saving-investment market shifts the IS curve out. or up. (Reason: Shifting the investment curve out c ...
... • Anything that shifts the saving curve or the investment curve in the saving-investment market, other than changes in Y , shifts the IS curve. • Anything that shifts the investment curve out in the saving-investment market shifts the IS curve out. or up. (Reason: Shifting the investment curve out c ...
Unemployment
... All unemployed aged 16-59 (women) / 64 (men), seasonally adjusted, source: Labour Force Survey and Claimant Count ...
... All unemployed aged 16-59 (women) / 64 (men), seasonally adjusted, source: Labour Force Survey and Claimant Count ...
Advanced Macroeconomics 4. The Zero Lower Bound
... during its long liquidity trap period: The economy has been weak the Fed has kept its policy rate close to zero. Ben Bernanke, as Chairman of the Fed, was not keen to implement the ideas he recommended as an academic. At his April 2012 press conference, he said: I guess the question is, does it make ...
... during its long liquidity trap period: The economy has been weak the Fed has kept its policy rate close to zero. Ben Bernanke, as Chairman of the Fed, was not keen to implement the ideas he recommended as an academic. At his April 2012 press conference, he said: I guess the question is, does it make ...
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.