ECON 2030 : Test Three Notes
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Economic growth, gdp, and inflation rates: economic growth is a percent change in gdp, expansion: economy growing above the long run rate, (technical) recession: two or more periods of consecutive negative growth in. The surplus in the labor market will lead to a decrease in labor costs causing profitability to increase. The costs will continue to decrease until the. Sras reaches equilibrium: example 2: there is a shortage in the labor market because unemployment levels are low. Firms looking for workers will have to hire someone away from another job by enticing them with higher wages and better benefits. This causes labor costs to increase making you less profitable until the economy is back in equilibrium. Lab questions: in the us, productivity growth rates move (countercyclically/procyclically) while unemployment moves (countercyclically/procyclically). This means that when the economy is experiencing an expansion, productivity growth rates _______: chris is a 33-year old mother who became bored raising her two daughters.