Notes 13 - Unemployment/Inflation Remember, Inflation: A...

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Unemployment/Inflation Remember, Inflation : A general rise in the average level of all prices in an economy, measured by an index such as CPI. Costs of Inflation: Deflation: A general fall in the average level of all prices in an economy, measured by an index such as the CPI. Costs of Deflation: Unemployment : People who want to work and are not working at all, and are looking for work. Unemployment Rate : number of unemployed as a percentage of the labor force. Costs of Unemployment: Today – Inflation? Increasing Energy Prices? Deflation? 1970’s High Inflation around the world Many countries had Stagflation: high unemployment and high inflation at the same time. New York Times | April 18, 2005, Monday Whiff Of Stagflation, By PAUL KRUGMAN Stock prices sank to five-month low last week because of fear of return to stagflation Claims mild form of stagflation has already arrived; Cites disappointing unemployment statistics and sluggish job creation What is the relationship between unemployment and inflation? Is there one? By 2009, the same Krugman was worried about deflation. Falling Wage Syndrome, By PAUL KRUGMAN , May 3, 2009 “Wages are falling all across America.” For February, Inflation (CPI-U) was 0%. Over the last 12 months it was 2.1% 1-Month Percent Change Series Id: CUUR0000SA0, Not Seasonally Adjusted Area: U.S. city average Item: All items Base Period: 1982-84=100 Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2000 0.3
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Notes 13 - Unemployment/Inflation Remember, Inflation: A...

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