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ECON 205 Lecture (3.24.2008)

ECON 205 Lecture (3.24.2008) - Chapter 10 Page 250 Causes...

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ECON-205 Lecture 3/24/2008 2 nd Midterm Coming Up!!! WEDNESDAY, APRIL 2 ND !!! What is economic growth? Economic growth is higher standard of living. How are you going to achieve this? Through economic development. Then, some theories. What is economic development? How to measure economic growth? Divide GDP by population… you get per capita income. “Time-Lag” On page 223, what is really the key to economic development? Answer: 1) establishing a system of property right, 2) developing an educated population, 3) letting “creative destruction” run its course, 4) limiting protectionism 1947: European Common Market World Trade Organization “Margin” NAFTA (North American Free Trade Agreement) Chapter 10: Read first 3-4 pages or so Chapter 9: What is economic growth? What is economic development?
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Unformatted text preview: Chapter 10: Page 250 Causes of inflation 1) Demand-pull inflation, 2) Cost-push inflation (labor unions cause this), 3) ?, 4) Hyperinflation, 5) Structural inflation Chapter 8: What is the classical school? For the past 250, we’ve adopted… Then, Ricardo came with concept of taxation. Then, Malthus came up with concept of population (growth). IMPORTANT: John N. Say a French economist, he joined an economics club at Oxford University. He came up with “Say’s Law,” which states, “Supply creates its own demand.” Look at the supply side, not the demand side. Came with assumptions: 1) pure competition exists in the economy (they were wrong), 2) wages and prices are flexible, 3) full employment is a normal way of life Classical school: from 1776 – 1928...
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