Macroeconomics Notes 3-6-08

Macroeconomics Notes 3-6-08 - Macroeconomics Notes 3/6/08...

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Macroeconomics Notes 3/6/08 - Stagflation : when there is little growth of the economy coupled with rising inflation o Stagnation is when the economy is not growing - Aggregate demand is not static and changes from year to year o Other things being equal, prices will keep rising o Demand-pull inflation : rapid increases in aggregate demand - Inflation is a period of rapidly increasing prices o Cost-pull inflation : rapid increases in the cost of a commodity - If aggregate demand is not increasing, the economy is not growing and may result in a recession o Prices should drop o Aggregate demand might decrease if consumer confidence drops due to: Uncertainty about the economy Interest rates that are too high - The total of all goods and services produced in the economy is called GDP (Gross National Product) - Sectors of the Market o Foreign trade and investment market o Bond/money market o Commodity market Housing market Wheat market Pizza-pizza market :) o Labor market - To assess how the economy is doing, there are certain variables to look at called
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This note was uploaded on 04/12/2008 for the course ECON 100 taught by Professor Park during the Spring '07 term at American.

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Macroeconomics Notes 3-6-08 - Macroeconomics Notes 3/6/08...

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