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Macro 9.pdf
- 4. Quiz Master
- 5. Accounting Pro fi t Explicit Costs Explicit + Implicit Costs Economic Pro fi t
- 7. Finance Time - t or n Risk - r or i
- 8. Foundation Finance Formula (1 + r ) n r = risk rate n = time periods
- 9. number of periods Value r = 5% r = 10% r = 15% Value = (1 + r)n r = rate n = number of periods
- 10. number of periods Value r = 15% Value = (1 + r)n r = rate n = number of periods Future Value Present Value
- 11. FutureValue? Future Value = Amount Today x Factor Factor is the Growth Formula (1 + r ) n r = rate n = time periods
- 12. FutureValue? (1 + r ) n r = 10% or 0.10 n = 5 years (1 + 0.10)5 (1.10)5 1.61
- 13. FutureValue? Future Value = Amount Today x Factor $161 = $100 x 1.61 Future Value is compounding Future Value is multiplying
- 14. PresentValue? Present Value = Future Amount ÷ Factor Present Value = $500 ÷ 1.61 $310.56 = $500 ÷ 1.61 Present Value is discounting Present Value is dividing
- 15. Finance Unknown - Present Value or Future Value? Must know rate and number of periods Compute Factor with formula (1+r)n If FV multiply If PV divide
- 16. Present Future x Factor ? ÷ Factor ? Factor Formula = (1 + r ) n
- 18. Culture Human Beings Ideas Physical Human Intellectual Financial Inventions Entrepreneurs Free Markets Innovations The Capitals of Innovation
- 22. Frictional Unemployment Time to find a new job
- 24. Structural Unemployment Too many workers Change in Demand
- 27. What kind of unemployment is caused by smartphones?
- 31. 99% Reduction in Energy 449 watts to 5 watts
- 32. Unemployment Rate Labor Force Participation Rate Rate are Ratios
- 33. Labor Force Adults 16+ who have jobs or are looking for jobs. Employed + Unemployed
- 34. Employed paid employees work in own business unpaid workers in family business full-time and part-time jobs but temporary absence
- 35. Unemployed not employed available tried to find a job in the last four weeks waiting to be recalled from layoff
- 36. Not in Labor Force not employed full-time student homemaker military retiree discouraged workers
- 38. Discouraged Worker People who would like to work but have given up looking for a job in the last four weeks
- 39. Who Measures? Department of Labor Bureau of Labor Statistics
- 40. Two Surveys The Current Population Survey (CPS) "household survey" Sample of 60,000 households. The Current Employment Statistics Survey (CES): "payroll survey" sample of 160,000 businesses and government agencies that represent 400,000 individual employees.
- 41. Labor Force Participation Rate The percent of the Adult Population that is in the Labor Force
- 42. Population 330 Adults 254 Labor Force 160 Employed 152 Under 16 76 Not in Labor Force 94 8 Unemployed Employed 152 8 Unemployed Not in Labor Force 94 Under 16 76 Labor Force Participation Rate = Labor Force ÷ Adults Unemployment Rate = Unemployed ÷ Labor Force Rates
- 43. 3,000 people live in Pooleynesia. There are 250 people under 16. 450 people are not in the labor force. 230 people are unemployed. 1. What is the Labor Force Participation Rate? 2. What is the Unemployment Rate?
- 44. Calculating Unemployment Rates Employed + Unemployed = Labor Force # % 100% The unemployment rate is 10% and there are 4,500 people employed. What is the number unemployed? 10% 90% 4,500 5,000 500 4,500 ÷ .90 = 5,000
- 45. Calculating Unemployment Rates Employed + Unemployed = Labor Force # % 100% The unemployment rate is 5% and there are 2,500 people unemployed. What is the number employed? 5% 95% 47,500 50,000 2,500 2,500 ÷ .05 = 50,000
- 46. Calculating Unemployment Rates Employed + Unemployed = Labor Force # % 100% The unemployment rate is 3% and there are 19,400 people employed. There are 30,000 adults. What is labor force participation rate? 3% 97% 19,400 20,000 600 19,400 ÷ .97 = 20,000 20,000 ÷ 30,000 = .67 or 67%
- 47. Unemployment Who measures it? How is it measured?
- 49. Men Women
- 50. Problems Overstate - Above actual Cash workers Understate - Below actual Discouraged workers