Chapter1_Business Cycle

Chapter1_Business Cycle - 81 1Business Cycles Facts...

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1Business Cycles Facts Objectives: o Review defining characteristics of the business cycle o Examine common features of business cycles o Briefly examine historical record of the Canadian business  cycle 8-1
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Business Cycle Terms: o Potential GDP The level of GDP the economics produces at full-employment  when resources are used at maximum potential level. o Trend - A general tendency for a variable to move in one direction. - or repeated movement in a time series variables o Business Cycle Short term  fluctuation in GDP away from potential GDP (trend  growth) o Time Series Graph 8-2
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Measures time on the X-axis and the variable in which we are  interested in on the Y-axis. 8-3
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o Phenomenon of the business cycle: Causes: Classical: disturbance of money spending. No need for  government to do anything Keynesian: prices change not fast enough, government should  act 8-4
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This note was uploaded on 07/12/2010 for the course ECON 202 taught by Professor Angelatrimarchi during the Spring '10 term at Waterloo.

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Chapter1_Business Cycle - 81 1Business Cycles Facts...

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