Eco 202 ch 31 monetary growth and inflation
Upcoming SlideShare
Loading in...5
×
 

Eco 202 ch 31 monetary growth and inflation

on

  • 1,443 views

 

Statistics

Views

Total Views
1,443
Views on SlideShare
353
Embed Views
1,090

Actions

Likes
0
Downloads
7
Comments
0

4 Embeds 1,090

http://afecon202.blogspot.com 1033
http://www.afecon202.blogspot.com 49
http://afecon202.blogspot.ae 5
http://afecon202.blogspot.ca 3

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Eco 202 ch 31 monetary growth and inflation Eco 202 ch 31 monetary growth and inflation Presentation Transcript

    • WhenMoney Dies
    • InflationCause - Printing money faster thannew goods and services are createdEffect - Rising prices
    • Does moneycreate wealth?
    • More MoneyMake more stuff Raise prices
    • Big Mac = 10 SR 1 SR =1/10 of aBig Mac
    • =1 SR =1/10 of a Big Mac
    • Money Supply Central Bank - SAMA
    • Dr. Fahad Al MubarakChairman of the Board GovernorSaudi Arabia Monetary Agency SAMA
    • 5. Greece, Oct. 1944Highest monthly inflation: 13,800% Prices doubled every 4.3 days
    • 4. Germany, Oct. 1923Highest monthly inflation: 29,500% Prices doubled every: 3.7 days
    • A 1000 Mark banknote, over-stamped in red with"Eine Milliarde Mark" long scale (1,000,000,000 mark), issued in Germany during the hyperinflation of 1923
    • 3.Yugoslavia, Jan. 1994Highest monthly inflation: 313,000,000% Prices doubled every: 1.4 days
    • 1. Hungary 1946Highest monthly inflation: 13,600,000,000,000,000% Prices doubled every: 15.6 hours
    • 2. Zimbabwe, Nov. 2008Highest monthly inflation: 79,600,000,000% Prices doubled every: 24.7 hours
    • 1833 - 1932 $18.94 to $20.69
    • $1,600 80xLost 98.75% of value relative to gold in 80 Years
    • Money Demand Liquid Credit Cards ATMs
    • Money DemandOpportunity Cost Potential Profit
    • Quantity Theory of Money The quantity of money determines its valueMilton Friedman (1912 - 2006)
    • 2.00 Money 1.50 SupplyValue of 1.00Money 0.50 Money Demand 0 1 10 20 30 40 50 Quantity of Money
    • How to get an A on Exam 4
    • 2.00 Money 1.50 SupplyValue of 1.00Money 0.50 Money Demand 0 1 10 20 30 40 50 Quantity of Money
    • The Life of a Riyal 18 months
    • Quantity Equation M xV = P x Q M = Money V = Velocity P = Price Q = Output
    • Government Spending Tax Borrow Print
    • Inflation TaxWhen the government prints more money, anyone who has money loses wealth
    • InflationWinners - BorrowersLosers - Lenders
    • Nominal = Real + Inflation N=R+IIf you know two you can calculate the other one If N = 12 and R = 10, what is I?
    • FormulasN=R+IRR = 1÷ MMRR = 1÷ MM
    • Facts Saudi Reserve Ratio: 7% Saudi ORR: 2% Saudi Money Supply Growth: 12% Saudi Inflation Rate: 3.9%Country with recent hyperinflation: Zimbabwe Country with recent bank run: Cyprus