ECN 211 Chapter Notes - Chapter 11: Nominal Interest Rate, Real Interest Rate

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10 May 2017
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In ation- an increase in the overall level of prices in the economy; when prices rise; value of the dollar goes down. We"ll learn how the rate of in ation is measured. In 1931 babe ruth was paid ,000 (seen as an extraordinary salary) In 2012 the median salary for a player on the yankees is 1. 9 million. Consumer price index- turning dollar gures into meaningful measures of purchasing power; used to monitor changes in the cost of living over time. In ation rate- percentage change in the price level form the previous period. Consumer price index (cpi)- a measure of the overall cost of the goods and services bought by a typical consumer; gauges how much incomes must rise to maintain a constant standard of living; not a perfect measure. A measure of a sample of goods and services, not all of them. Department of labor -> bureau of labor a statistics (bls)

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