ECO 2306- Midterm Exam Guide - Comprehensive Notes for the exam ( 18 pages long!)
13 Oct 2017
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Inflation increase in overall levels of prices in economy: society faces a short-run trade-off between inflation and unemployment. Increased hiring = decrease in unemployment = short-run trade-off between inflation and unemployment. Playing a key role in business cycles (irregular and largely unpredictable fluctuations in economic activity, as measure by the production of goods and service or the number of people employed: monetary. Chapter 2 : circular flow diagram, 2 types of decision makers: firm & household, firms produce goods and services by inputs of labor, land, and capital (buildings and machines) Chapter 4 : market = group of buyers and seller of a particular good/service, determines demand for product, competitive market many buyers/sells that each has a negligible impact on market. Influences: availability of close substitutes tend to have more elastic demand because it is easier for consumers to switch from one good to another, necessities vs.
