ECON 202 Lecture Notes - Gdp Deflator, Real Interest Rate, Nominal Interest Rate
27 Feb 2013
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Macroeconomics focuses on the behavior of key macroeconomic variables including: Since the early 1990s, the inflation rate has been in the narrow range of 1-3% per year. Consistent with the bank of canada target: the unemployment rate the proportion of the labour force out of work (fig 1-3) The ur is strangely countercyclical with gdp: rising in recessions and falling in expansions. [during the great depression] and lowest in the 1940s [during. Behavior of prices: tlekible (lr) & sticky (sr) d s (many not). Market clearing (equilibrium) (ch 7-8) omit (ch 9-13) Count the value of final goods & services only in the gdp calculation, otherwise, double-counting will occur: if goods or services don"t have a price, use an imputed value. Ex. (1) imputed rent on owner-occupied housing (2) government services are valued at cost: excluded: Underground economy (transaction that don"t go through market) Investment (i) (net financial investment) i. e. domino pizza buying a store.
