ECON 203 Lecture Notes - Lecture 1: Glossary Of Partner Dance Terms, Gdp Deflator, Automatic Stabilizer
1 Sep 2016
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Chapter 4 measuring national economic activity and performance. Natural employment = structural employment + frictional employment + How to measure nominal gdp: output-based gdp, price intermediate input = value added, prevents double counting, expenditure-based gdp, gdp = c + i + g + x im. Income-based gdp: wages + b + i + cca +tin. Chapter 5 output, business cycles and employment. Price of oil decreases (cheaper to run machines: decreases when. Price of oil increases (more expensive to run machines) Aggregate demand: downward sloping because of. Interest rate effect (higher interest rate, less spending) Wealth effect (prices are high, it decreases real wealth and. People can"t buy as much so aggregate demand decreases) Output gap = (y yp: inflationary gap when actual gdp is greater than potential output, recessionary gap when actual gdp is less than potential output. Adjustments to output gaps: automatically (no g or central bank, fiscal or monetary policies (g or central bank)
