aggregate demand curve
... shocks that raised prices and lowered output, including spikes in oil prices. • Increases in oil prices shift the aggregate supply curve. However, they also have an adverse effect on aggregate demand. • Because the United States is a net importer of foreign oil, an increase in oil prices is just lik ...
... shocks that raised prices and lowered output, including spikes in oil prices. • Increases in oil prices shift the aggregate supply curve. However, they also have an adverse effect on aggregate demand. • Because the United States is a net importer of foreign oil, an increase in oil prices is just lik ...
The costs of inflation – what have we learned?
... low rate can easily turn negative. There is also an upward bias in inflation statistics – thus an economy could actually be experiencing the negative effects of deflation when the official inflation rate is positive, ...
... low rate can easily turn negative. There is also an upward bias in inflation statistics – thus an economy could actually be experiencing the negative effects of deflation when the official inflation rate is positive, ...
Exercise 6 (+additional question) in Mankiw:
... 2.8a. A hurricane in Florida forces Disney World to shut down for a month. 2.8b. The discovery of a new, easy-to-grow strain of wheat increases farm harvests.. 2.8c. Increased hostility between unions and management sparks a rash of strikes. 2.8d. Firms throughout the economy experience falling dema ...
... 2.8a. A hurricane in Florida forces Disney World to shut down for a month. 2.8b. The discovery of a new, easy-to-grow strain of wheat increases farm harvests.. 2.8c. Increased hostility between unions and management sparks a rash of strikes. 2.8d. Firms throughout the economy experience falling dema ...
If GT =0, Debt/GDP increases if the r > growth rate of GDP
... A. The closed economy: The interest rate is flexible. Main lesson: Increased government spending or lower net taxes (which implies a higher government budget deficit) increases the real interest rate and thereby lowers private investment to the same extent so that aggregate demand and output are unc ...
... A. The closed economy: The interest rate is flexible. Main lesson: Increased government spending or lower net taxes (which implies a higher government budget deficit) increases the real interest rate and thereby lowers private investment to the same extent so that aggregate demand and output are unc ...
how do firms form their expectations? new survey evidence
... targeting in 1990 and has experienced relatively low and stable inflation since then. In contrast, no firms reported believing that prices had fallen during this time period, so errors about recent inflation were highly asymmetric. This asymmetry is absent in firm beliefs about GDP growth, unemploym ...
... targeting in 1990 and has experienced relatively low and stable inflation since then. In contrast, no firms reported believing that prices had fallen during this time period, so errors about recent inflation were highly asymmetric. This asymmetry is absent in firm beliefs about GDP growth, unemploym ...
NBER WORKING PAPER SERIES OPTIMAL SIMPLE AND IMPLEMENTABLE MONETARY AND FISCAL RULES
... Exceptions are Khan, King, and Wolman (2003) and Schmitt-Grohé and Uribe (2004). We note that an accurate first-order approximation to the utility function around the non-stochastic steady state can be obtained using a linear approximation to the equilibrium conditions. But such an approximation is ...
... Exceptions are Khan, King, and Wolman (2003) and Schmitt-Grohé and Uribe (2004). We note that an accurate first-order approximation to the utility function around the non-stochastic steady state can be obtained using a linear approximation to the equilibrium conditions. But such an approximation is ...
5th Edition
... Besides, wages and prices don’t adjust fast enough anyway; so even if people anticipated the inflation, they couldn’t do enough about it to make the short-run Phillips curve vertical. © 2015 Pearson Education, Inc. ...
... Besides, wages and prices don’t adjust fast enough anyway; so even if people anticipated the inflation, they couldn’t do enough about it to make the short-run Phillips curve vertical. © 2015 Pearson Education, Inc. ...
Do increases in oil prices precede US recessions?
... My family comes last but they are really important. Without my family, I would not have a chance to grow up. They gave me superb support and raised me as best as parents possibly could. If there were any words better than "thank you very much", I would say them. ...
... My family comes last but they are really important. Without my family, I would not have a chance to grow up. They gave me superb support and raised me as best as parents possibly could. If there were any words better than "thank you very much", I would say them. ...
Measuring Economic Activity
... problems economists have to solve when they use money as their measuring rod. Clearly, we want a measure of the nation’s output and income that uses an invariant yardstick. Economists can replace the elastic yardstick with a reliable one by removing the price-increase component so as to create a rea ...
... problems economists have to solve when they use money as their measuring rod. Clearly, we want a measure of the nation’s output and income that uses an invariant yardstick. Economists can replace the elastic yardstick with a reliable one by removing the price-increase component so as to create a rea ...
Aggregate expenditures
... and the concept of equilibrium real GDP. 2. Distinguish between autonomous and induced aggregate expenditures and explain why a change in autonomous expenditures leads to a multiplied change in equilibrium real GDP. 3. Discuss how adding taxes, government purchases, and net exports to a simplified a ...
... and the concept of equilibrium real GDP. 2. Distinguish between autonomous and induced aggregate expenditures and explain why a change in autonomous expenditures leads to a multiplied change in equilibrium real GDP. 3. Discuss how adding taxes, government purchases, and net exports to a simplified a ...
the macroeconomics of the trym model of the
... Aggregation has advantages in terms of simplicity of interpretation and making the model easier to maintain. It comes at a price, however. In general, it means that all the underlying causes of the behaviour of the aggregates are not necessarily identified (see Section 6.1.2). Effects from changes i ...
... Aggregation has advantages in terms of simplicity of interpretation and making the model easier to maintain. It comes at a price, however. In general, it means that all the underlying causes of the behaviour of the aggregates are not necessarily identified (see Section 6.1.2). Effects from changes i ...
Structural Adjustment during Canada’s Wheat Boom: 1900-1913* Abstract Emma Stephens
... decreasing rate, as opposed to the agriculture sector, with employment growth rates declining from between 3 and 4% per year to between 1 and 2%. The changes in both agriculture and manufacturing overall mask changes in individual sub sectors of each industry. In agriculture, meat made up the prima ...
... decreasing rate, as opposed to the agriculture sector, with employment growth rates declining from between 3 and 4% per year to between 1 and 2%. The changes in both agriculture and manufacturing overall mask changes in individual sub sectors of each industry. In agriculture, meat made up the prima ...
Term 2 Week 6 to 9 - Singapore A Level Notes
... full employment and healthy BOP. Consider some of the difficulties in its attempts to meet them simultaneously. A government’s macroeconomic objectives are economic growth, low inflation, full employment and healthy BOP. Which of these aims do you consider most significant for Singapore and why? Dis ...
... full employment and healthy BOP. Consider some of the difficulties in its attempts to meet them simultaneously. A government’s macroeconomic objectives are economic growth, low inflation, full employment and healthy BOP. Which of these aims do you consider most significant for Singapore and why? Dis ...
Housing and Endogenous Default ∗ Emily Marshall Paul Shea
... Gale and Hellwig (1985) model default in a very different setting. They solve for the optimal debt contract in a framework where asymmetric information motivates costly verification in which the state is only observed if the firm is insolvent and goes bankrupt. They show that the optimal credit con ...
... Gale and Hellwig (1985) model default in a very different setting. They solve for the optimal debt contract in a framework where asymmetric information motivates costly verification in which the state is only observed if the firm is insolvent and goes bankrupt. They show that the optimal credit con ...
TRYM - Treasury archive
... The structure of the TRYM model, while being much more complex, has similarities to that of Figure 1. It broadly identifies three decision units (the household sector, the business sector and the government sector) and three markets (the goods market and its sub-components, the labour market and the ...
... The structure of the TRYM model, while being much more complex, has similarities to that of Figure 1. It broadly identifies three decision units (the household sector, the business sector and the government sector) and three markets (the goods market and its sub-components, the labour market and the ...
DP2010/14 Monetary Policy, In‡ation and Unemployment Nicolas Groshenny December 2010
... Nt 1 employees. Before production starts, Nt 1 old jobs are destroyed. The rate of job destruction is constant. The workers who have lost their job start searching immediately and can possibly still be hired in period t. The law of motion of aggregate employment is Nt = (1 ...
... Nt 1 employees. Before production starts, Nt 1 old jobs are destroyed. The rate of job destruction is constant. The workers who have lost their job start searching immediately and can possibly still be hired in period t. The law of motion of aggregate employment is Nt = (1 ...
To encourage a local milling industry, both Canada and the United
... competitive model, these forests, including the Klamath and Wallowa-Whitman forests in Oregon, would not have undertaken operations resulting in continuing losses. The FS very definitely supplied timber well beyond economic amounts by cross-subsidizing profitable forests with unprofitable ones and b ...
... competitive model, these forests, including the Klamath and Wallowa-Whitman forests in Oregon, would not have undertaken operations resulting in continuing losses. The FS very definitely supplied timber well beyond economic amounts by cross-subsidizing profitable forests with unprofitable ones and b ...
Metroeconomica paper outline proposal (10-04-03)
... adjusting the nominal interest rate to changes in the inflation rate CBs can then bring current output in line with potential output (equation 2).3 There are two essential features of this adjustment process. First, monetary policy affects real variables as long as temporary nominal rigidities give ...
... adjusting the nominal interest rate to changes in the inflation rate CBs can then bring current output in line with potential output (equation 2).3 There are two essential features of this adjustment process. First, monetary policy affects real variables as long as temporary nominal rigidities give ...
Lecture 2: Key Economic Variables and Concepts Gross Domestic
... If we use a deflator computed using last year's prices as our base year, we compute the percent rise in the GDP deflator as (100-78)/78 = 28%. If we use a deflator computed using this year's prices, we compute the percent rise in the GDP deflator as (129-100)/100 = 29%. That is, in one case, we say ...
... If we use a deflator computed using last year's prices as our base year, we compute the percent rise in the GDP deflator as (100-78)/78 = 28%. If we use a deflator computed using this year's prices, we compute the percent rise in the GDP deflator as (129-100)/100 = 29%. That is, in one case, we say ...