Lecture 13 (post)

Lecture 13 (post) - Readings Text Econ 1120-02(Basu Lecture...

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Econ 1120-02 (Basu) Lecture 13 (March 5) Readings: Text Ch7
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Announcements One "Practice" will be available at the same time of each "Quiz" . "Practice" will have similar questions as the "Quiz", it is a learning device for you. You can go to Review and see correct answers for each question in the "Practice" But scores on "Practice" will not count as part of your final grade. If you think you have already mastered the material and don't need any practice, you can go straight to the "Quiz". Review on Quiz questions with correct answers is only available AFTER due date. After each attempt, MEL will generate a "Quiz Summary". This tells you in which questions you made a mistake. The sequence of the questions won't change for different attempts. However, the sequence of the choices and the numbers in each question will change randomly. "Quiz Summary"can be printed out. But make sure not to close the window. Once closed, the window cannot be recovered. Please start the final attempt on each quiz at least 90minsbefore the due time ( Monday at 12noon ). Otherwise, MEL will not let you start.
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The distribution of grades from Prelim 1 should be available in class on Thursday. You can pick up your exams from your respective TA’s offices (Uris and GSH) on Thursday late afternoon/Friday. I will announce the exact office hours of theTasin class on Thursday. Note: The final exam is on May 16 th , 7pm-9.30pm. The make-up will be on May 17 , 7-9.30pm.
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The Process of Deflating & The Implicit GDP Deflator Index Deflating: changing a measure from a current or nominal value to a real value by use of a deflator. implies you have or need a deflator! To deflate (if you have a deflator): $nominal ÷ deflator = $real ... turning things on their head $real = (implicit) deflator Note: the government reports the following $nominal GDP $real GDP So. .. [$nominal GDP $real GDP] = implicit GDP deflator And. ..to make it an index $real GDP] * 100 = implicit GDP Deflator INDEX
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Nominal GDP, Real GDP & The Implicit GDP Deflator Index (IGDPDI) GDP in billions of current dollars chained 2005 2000 9,951.5 11,216.4 2001 10,286.2 11,337.5 2002 10,642.3 11,543.1 2003 11,142.2 11,836.4 2004 11,853.3 12,246.9 12,623.0 2006 13,377.2 12,958.5 2007 14,028.7 13,206.4 2008 14,291.5 13,161.9 2009 13,939.0 12,703.1 2010 14,526.5 13,088.0 2011 15,087.7 13,313.4 What is IGDPDI for 2005? = [2005 GDP (current, 2005 prices)/ 2005 GDP (Chained, 2005 prices)] * 100 = 100 What is IGDPDI in 2011? = [2011 GDP(current, 2011 prices)/ 2011 GDP (Chained, = 113.3 Thus, Inflation between 2005 and 2011 = 13.3% ** what is the average rate of inflation between 2005 and 2011? 05-06, 06-07, 07-08, 08-09, 09-10, 10-11 (divide 13.3 by 6). What is the rate of inflation between 2010 and 2011? ** Calculate IGDPDI for 2010
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Lecture 13 (post) - Readings Text Econ 1120-02(Basu Lecture...

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