Midterm 1 Econ 002
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This 4 page Study Guide was uploaded by Edgar Tellez on Thursday October 13, 2016. The Study Guide belongs to Econ 002 at University of California Riverside taught by Craig McLaren in Fall 2016. Since its upload, it has received 5 views. For similar materials see Intro to Macroeconomics in Macro Economics at University of California Riverside.
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Date Created: 10/13/16
Midterm notes/Study guide Professor Lang went over all of this throughout the last weeks. nominal GDP= actual dollar in transactions nom gdp =Qf*pf*qf*Ph+ nominal gap increase can come from prices or quantity real gdp : set prices to be the same every year pick a year=base year=2009 set prices equal to 2009 prices every year Real gap in 2016= Q16P*p09F=q16h*p09h +q16H*p09H 1500=150x1….=21500 increase in real gdp drama by production increases real gdp09=q09F*p09F+…. Base year real gdp=nominal gdp real gdp 2016:real gdp09+13500 nominal gdp2016=35500 nom gdp +13500 how much did the prices increase nominal gdp in 2016? gdp deflator of 16=nomgdp16/realgdp16*100 gdp deflator 16= 3500/21500*100=165 gdp delator 09=13500/13500*100=100 inflation date =gdp deflator-gdpdef/gdp def*100 165-100/100*100=65% Growth in real GDP= real gdpb-real gdpa/real gdpa*10 21,500-13500/13500*100=59.26% 13500—.35,500 Goal: full employment unemployment=/rate=bureaue of labor statistics (BLS) 60,000 unemployment : 1: did not work for at least 1 hour last week 2 actively searched for work in put 4 weeks not unemployed in nit actively seacheching 1. frictional unemployment: Time lag between leaving one job and starting a new one 2. seasonal unemployment: predictable changes in the unemployment rate that happen every year 3. structural unemployment: mismatch between skills of workers and needs of employers 4. cyclical unemployment: job loss that results directly from changes in economic production expected unemployment rate: natural rate of unemployment= frictional + seasonal + structural (long term) current unemployment rate ;5% natural rate of UE : 4,8% 0,2% cyclical /UE Goal: natural rate of unemployment full em: 4,8% UE rate full em output: - y last time: ended on consumption (68%) impuded rent : estimate of the value of properties on the market —>services investment: 3 categories (I) 1. fixed investment :purchase by firms, 2. menu equipment , hardware Not intermediate goods, ex. farmer tractor to harvest corn 2 New home sales for land/ family 1. change in inverntoy: unsold goods Government purchase (G) -goods and services bought by the government -income /social security —> net production -federal spending -military 60% of federal spending local and state spending cal trans, police , fire, education exports: money coming into the country 4. net exports (NX) =x-m can be negative trade short comings of gap -unaccounted transactions -mafia ● drugs ● legal actions *yard sales *flea markets 1.underground activités / economy 1. under ground economy/activity (even higher percentage else where) 2. realitivly constant from year to year inaccurate level but chg in accurate non market /activity female in the labor market have doubled -day care ] -more restaurant meals ] counted today but -house keeping services ] not in past month measure/calc gdp: economy at UCR product: food, housing, movies q:100,100,500 p:1,100,5 people are benefiting from growth others on unemployment. if mini wage goes up, unemployment goes down. stable prices in 2008 the inflation was 89,700,000,000,000,000,000,000 some inflation is okay GDP: gross domestic product GDP: p*q1+p*q2+p*q3 good: iPhone, galaxy, gas services; buy but don’t gain ownership -uber -labor -lawyer -medical -rental apps -education -leasing a car do home sale count? only new homes GDP ing 2008: 2014: 78.78 trillion US~18 tril expenditure approach US is a service based economy purchase infrequently —> new home investment in land and for the family if min wage increases then jobs are lost. slope= change in y value/ change inc value (12-10)/(16-12)=2/4years=.50 per year of education y=mx+b <— solve for b plug in (12,10) 10=0.5x12=b 10=6+b b=4 salary=0.5xedu +4 explain meaning ssaume=complete competitive market 1)lots of buyers and sellers 2)all products are identical 1. no/low barriers to entry compettion low barrier high barrier ——————————————————————————— farmers markey cars cable gasoline—>drilling of,,—>high barrier gas station —>save money—>low barrier price —>demand for gas. we are interested in how much gas consumers are willing to purchase. at the difference price level quantity de,and—>actual amount purchased price=4.50 q=6 price=4 q=8 3.50 10 3 12 2.50 14 2 16
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