Macro 13
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This document provides information about macroeconomics and inflation. It discusses different types of unemployment like frictional, seasonal, and structural unemployment. It also discusses topics like unemployment insurance, minimum wage laws, labor unions, efficiency wages, and the quantity theory of money. It provides examples of inflation rates in countries like Venezuela and Zimbabwe to illustrate hyperinflation. It concludes with a question about what companies can do when they have lines waiting to buy their product.
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Macro 13
- 2. Macroeconomics Lecture 13 Inflation and the Quantity Theory of Money Chapter 12
- 3. Questions?
- 4. millions % Population % Adults % Labor Force Population 320 100% Age under 16 66 20% Age 16+ 254 80% 100% Not in Labor Force 94 30% 37% In Labor Force 160 50% 63% 100% Employed 152.3 47.6% 60% 95.2% Unemployed 7.7 2.4% 3% 4.8%
- 5. Problems Overstate - Above actual Cash workers Understate - Below actual Discouraged workers
- 7. Frictional Unemployment Time to find a new job
- 9. Structural Unemployment Too many workers Change in Demand
- 12. What kind of unemployment is caused by smartphones?
- 15. ?
- 17. Unemployment Insurance Government program to provide income when workers become unemployed
- 18. Unemployment Insurance Unintended Consequence Moral Hazard May prolong unemployment
- 19. Minimum Wage Laws Government sets a minimum wage that can legally be paid Price Floor
- 20. $0 $5 $10 $15 $20 0 10 20 30 40 50 60 Supply Demand Wage Workers Equilibrium Wage 30 workers 30 jobs no unemployment Minimum Wage 40 workers 20 jobs 20 unemployed workers Minimum Wage 20 workers get a raise 10 workers lose job 10 new unemployed workers Minimum Wage
- 21. Labor Union Worker association that negotiates with employers over wages, benefits, and conditions
- 22. Labor Union One contract Strike Conflict between workers
- 23. Efficiency Wages Higher wages make more productive employees
- 24. Efficiency Wages Employee Wage Pizzas Productivity Wage per Pizza Bob $10 5 $2.00 Bill $20 12 $1.67
- 25. Efficiency Wages More Healthy Lower Turnover Higher Quality More Effort
- 26. Inflation and the Quantity Theory of Money Chapter 12
- 27. Who wants to be a Trillionaire?
- 35. 2013 $1 = 7 2018 $1 = 25,000
- 37. When you have lines waiting to buy your product, you can do two things: make more, or raise prices