Notes: April 5, 2016
Notes: April 5, 2016 ECON2020
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This 2 page Class Notes was uploaded by Morgan Genelin on Sunday May 1, 2016. The Class Notes belongs to ECON2020 at University of Colorado taught by Murat Iyugan in Winter 2016. Since its upload, it has received 10 views. For similar materials see Principles of Macroeconomics in Economcs at University of Colorado.
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Date Created: 05/01/16
April 5, 2016 The Thursday we had off. The next Tuesday we were in class for all of 15 minutes. So this is one day of notes for 2 weeks of material. If consumer spending goes up a. Inventories go down (we go into a boom economy) If interest Rates rise a. Borrowing goes down b. Investment would go up, but it would eventually drop so that the graph can be at equilibrium again If Growth Rate rises a. Inventories will fall a. We are growing at a rate faster than we are selling, so we would be going into a Boom economy If sales go down: a. Inventories go up a. We are entering into a bust economy where there is more inventories supplied than there is demanded. If investment spending falls: a. Consumer spending falls b. Government spending falls c. Business spending falls d. Income falls e. GDP falls (I – S) > 0 Surplus (I – S) < 0 Deficit G>T Budget Deficit G<T Budget Surplus EX>IM trade surplus, outflow IM>EX trade deficit, inflow Whenever there is a reduction in planned spending, multiply by the multiplier and subtract that from the original equilibrium. The same goes for if there is an increase in planned spending, but instead of subtract, add.
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