PPT-Business Cycles, Unemployment, and Inflation

09 McGrawHillIrwin Copyright 2012 by The McGrawHill Companies Inc All rights reserved The Business Cycle Alternating increases and decreases in economic activity over time Phases of the business cycle. What are the . 4 types . of unemployment?. How are unemployment rates determined?. What is full . employment a. . underemployment?. . What. is a . discouraged worker?. "It's a recession when . your neighbor . Maritta Paloviita and Matti Viren. Bank of Finland and . University. of Turku . Basic idea. The . basic idea . is . an attempt to see whether the Phillips curve has shifted due to the  EMU (better anchoring of expectations . Swings in the. Economic Pendulum . Instability in the . Growth . of Real . GDP: 1960-2013. Although real GDP in the . United States has . grown at an average rate of approximately 3%, the growth has been characterized by economic ups-and-downs. . Taking a look at the “BIGGER” picture.. TOPICS COVERED:. GDP. CPI. Inflation. Stagflation. Aggregate supply. Aggregate demand. Calculations for economic growth, inflation, and unemployment . Structural, cyclical, and frictional unemployment. Has Consequences:. Reasons . and Ways for Young People to Participate in the . Decision-Making . Process at Home and EU. ”. Velingrad, Bulgaria. March 2012. This project has been funded with support from the Youth in Action Program of the European Commission, managed in Bulgaria by the National Centre “European Youth Programmes and Initiatives”. This publication reflects the views only of the author, and the Commission, the Youth in Action Program and the National Centre “European Youth Programmes and Initiatives” cannot be held responsible for any use which may be made of the information contained therein.. Swings in the. Economic Pendulum . Instability in the . Growth . of Real . GDP: 1960-2015. Although real GDP in the . United States has . grown at an average rate of approximately 3%, the growth has been characterized by economic ups-and-downs. 2-2. Economic Conditions . Change. The Business Cycle. All economies experience good and bad economic periods. This economic shift between good and bad economic conditions is called the . business cycle. of macroeconomics. Aggregate demand. and business cycles. Aggregate supply. and “economic growth”. The Great Divide. Classical macro:. - Full employment. - Flexible wages and prices. - Perfect competition and rational expectations. Economics. Unemployment. Economist’s definition:. Those of working age, who are without work, but who are available for work at current wage rates.. Two . measures . of unemployment.. Claimant . count. &. Fluctuations. Section I. Business Cycles & Fluctuations. Business cycles . are largely systematic ups and downs of real GDP. Business fluctuations . is the rise and fall of real GDP over time in a nonsystematic manner.. Vocab. Inflation. Deflation. Price index. Consumer price index. Market basket. Base year. Creeping inflation. Hyperinflation. Stagflation. Demand-pull inflation. Cost-push inflation. Civilian labor force. Orange Group. This is chapter . 35. !!. The natural rate of unemployment depends on various features of the labor market.. Examples include minimum-wage laws, the market power of unions, the role of efficiency wages, and the effectiveness of job search.. 8. C H A P T E R. ECONOMIC GROWTH. An . increase in real GDP. over some time period. An . increase in real GDP per capita. over some time period. Growth as a Goal. Arithmetic of Growth. Rule of 70. Money and Inflation. Rise in money supply does not equal a rise in Real GDP in the long run, since price level rises as well by the same percentage. Classical Model of Price Level . – Since money supply and price level rise together, the Real Quantity of Money (M/P) stays at the original level.