Econ182_lecture6

Econ182_lecture6 - W Lena 4%"; Price Level...

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Unformatted text preview: W Lena 4%"; Price Level Mjufimmf a 71% “Qued’ovy flour»; Man; EMMA? flak "Werskufing " barium“, 0:! HR “Lona-Mn“ I PPM! "F 3.9“ SONY“! adj“? h d“? H! NVM+ Recording 4» Ken: MS , TL: mori- n'myorknf‘ Natal win is fit price 0; NM (3.9., wars) , In: in nominal canine-4"». Kc; Fmrosih‘on t In fin lug-m. I clan” in f)»: M: is neui'm‘ Tia-F :3, I3" Jae: Im‘ uni-hr you m+’h+ or Hug reldv‘ve "m, 43 ,ud: l :ww‘ces, 1+ «I, suns a [mporh'onak inure»: in fie {Nu level. WP: 1.43,!) 97 2%") =37 vh‘H‘ Y,‘ Cash's?" MW :7 957. Wu PT 5) 7‘7. In a cross-section of countries, 1200 long-term changes in money supplies and price levels show a clear positive correlation. 1000 (T he diagonal line indicates exactly proportional changes in money supplies and price levels.) 800 Source: OECD. Main Economic Indicators, and IMF, International Financial Statistics. 600 United 0 Kingdom Percent increase in price level .h 0 O 0 France . 0 Canada .Japan oGermany 0 200 400 600 800 1 000 1200 Percent increase in money supply 100 m ‘ 8 , i e .' ’ l a) / 4Q! 50 ] .1) / Y c l ,” . o ./ o l '5 l 5 I E 1 . .6 , i ' a?" ’ ' l _ ’ _______~#f_. 0 J.c_.__z____._ ~——-——— 0 50 100 Money growth (percent) Percent 1974 1976 i975 In(CPIge,JCPIu.,_) Ip(DM/U.S.$) m a: V4 m .0 co 0: o —r 01 co‘ v to h m ' O: o --I N m b h r~ b Is 5 90' co co no, co co co an co 0': c7: c7: ' Source: Intemafional'Finaficial Statistics 1980 1982 1984 198§ 1988 1990 1992 g 9. {German to us. CPIs, Jan. 1972-May 1995 s 1994 1995 Wk} Over slooh‘ n2 3 K23 assumph‘ws are "snail: fir ovw ska-Fay. R) 6’9on markd's are S‘ow +0 adjusw“ but, Ska-k7 Pm-CS) 2.) AS$¢+ Markd’S Ayn?“ 39130053 MW "Kn’w'ml Expekh'ansh - no? amb'ca‘fd-c {aka [the level LL”. as, am] "corn: flair efifecl: w‘ . . P . P Radian! @Wrslulhg i Shaka me: 4- Dr ‘F Exyeda’w'ou Assume ‘m‘HAH‘a gig-é— 30 “ml R=)Q* h) MS? ‘37 %’T (Jae ‘- shut; Imus) £7 R ~L L‘I'I dew navel Yuk-1'. 7 Y fiotwhn z.) From U1?) fie «I? w” Rx} is if {ruled-M's €¥P¢s+ fie domesh‘c entrant? he ea: . 3‘) However, imam; know +A..+ Me P¢'~n¢n+ M”“ will even‘H‘a/ly lead A a M51." Phi: level a»! It dfieakka’ Current; 40.) How can He annean 6o+k 6e erred-col I‘o “N’edd’fi “MI 9W» ‘1’; be depreu‘al-ed :3. FM (on; . rum '7, Answer‘. '3} new} “"13"; SN“? Move [*5 LR ezuil. Vaduz. I+ mus+ "WU MW“, Dammig Kesrmx h g PHMMM+ M91. M E \2. A E‘ -§‘§U§t'b. a». i ‘ a - a.» we 5 x.\ e 3 “\V‘. Rif‘E -£. ' e E\ “ ‘b 9...? u v I ' . 3 £35.22: 2 I ‘ 3 1 Lame) ; i s 1 M, n; I “3 ’rl rt a ‘.¢-OI~- 0'- 1 /P. ...
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Econ182_lecture6 - W Lena 4%"; Price Level...

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