This document provides instructions for an activity where students will be split into groups and each assigned a type of tax. The groups will create posters explaining their assigned tax to teach the class. It lists the group assignments for proportional, progressive, and regressive taxes. It outlines the task and expectations for the poster assignment. It also provides warmup questions and activities on taxes and monetary policy for the class.
The document provides an overview of equilibrium national income. It explains that equilibrium occurs when aggregate expenditures equal total income in the economy. If expenditures are greater than income, inventories will decrease and income will rise. If expenditures are less than income, inventories will increase and income will fall until equilibrium is reached. The income multiplier effect means that a change in investment spending will lead to an even larger change in national income. The paradox of thrift holds that if everyone tries to save more, it can decrease national income and leave people no better off in terms of savings.
The document discusses inflation in India. It defines inflation as a sharp rise in price levels caused by too much money chasing too few goods. It also discusses variations like deflation, hyperinflation, and stagflation. The causes of inflation include demand-pull inflation from economic growth and cost-push inflation from rising costs. Methods to control inflation involve monetary measures from the central bank, fiscal measures from the government, and increasing production. Inflation is measured using indices like the Consumer Price Index and Wholesale Price Index.
The document provides an overview of the causes and macroeconomic outcomes of the Great Recession that began in December 2007. It discusses several shocks that contributed to the crisis, including the bursting of the housing bubble, a global savings glut, subprime lending, and volatile oil prices. The recession resulted in a 3.6% decline in output, an unemployment rate that peaked at 10%, and over 8 million jobs lost by early 2010. This downturn was more severe than the average postwar recession in terms of its impact on GDP, employment, consumption, and other indicators.
The document presents research on estimating a myopic loss aversion (MLA) index from cross-sectional data on subjective well-being (SWB). It outlines how existing SWB models are potentially misspecified by not accounting for loss aversion. The author proposes a new econometric theory and methodology to estimate an MLA index parameter from SWB regressions. This would involve rewriting SWB models to separately estimate coefficients for economic gains (βG) and losses (βL) using a two-stage least squares procedure. The ratio of the estimated coefficients (βG/βL) would provide a direct estimate of the MLA index. The research aims to test if the MLA index varies across income levels
This document provides an introduction to macroeconomics. It defines macroeconomics, discusses key questions in the field, and outlines different schools of thought regarding the appropriate role of government intervention in the economy. The document also summarizes different economic goals and debates around activist versus non-activist policy approaches.
The document discusses the concepts of inflation and the Phillips curve. It provides background on the Phillips curve, originally proposed in 1958, which suggested an inverse relationship between inflation and unemployment. It also discusses how the Phillips curve relationship broke down in the 1970s with the occurrence of stagflation, where inflation and unemployment rose simultaneously. The document explores potential reasons for shifts in the Phillips curve over time.
- Real interest rates in the US are currently at their most negative level in almost three decades, which is an important development that should not be ignored by investors.
- Historically, periods of deeply negative real rates have typically been followed by improvements in leading economic indicators and increased spending, consumption, and demand for assets by both consumers and businesses.
- Based on historical relationships, the current negative real rate environment suggests that US economic prospects and equity markets may find increased support and possibly a sustained rally in the coming year.
The document provides an overview of equilibrium national income. It explains that equilibrium occurs when aggregate expenditures equal total income in the economy. If expenditures are greater than income, inventories will decrease and income will rise. If expenditures are less than income, inventories will increase and income will fall until equilibrium is reached. The income multiplier effect means that a change in investment spending will lead to an even larger change in national income. The paradox of thrift holds that if everyone tries to save more, it can decrease national income and leave people no better off in terms of savings.
The document discusses inflation in India. It defines inflation as a sharp rise in price levels caused by too much money chasing too few goods. It also discusses variations like deflation, hyperinflation, and stagflation. The causes of inflation include demand-pull inflation from economic growth and cost-push inflation from rising costs. Methods to control inflation involve monetary measures from the central bank, fiscal measures from the government, and increasing production. Inflation is measured using indices like the Consumer Price Index and Wholesale Price Index.
The document provides an overview of the causes and macroeconomic outcomes of the Great Recession that began in December 2007. It discusses several shocks that contributed to the crisis, including the bursting of the housing bubble, a global savings glut, subprime lending, and volatile oil prices. The recession resulted in a 3.6% decline in output, an unemployment rate that peaked at 10%, and over 8 million jobs lost by early 2010. This downturn was more severe than the average postwar recession in terms of its impact on GDP, employment, consumption, and other indicators.
The document presents research on estimating a myopic loss aversion (MLA) index from cross-sectional data on subjective well-being (SWB). It outlines how existing SWB models are potentially misspecified by not accounting for loss aversion. The author proposes a new econometric theory and methodology to estimate an MLA index parameter from SWB regressions. This would involve rewriting SWB models to separately estimate coefficients for economic gains (βG) and losses (βL) using a two-stage least squares procedure. The ratio of the estimated coefficients (βG/βL) would provide a direct estimate of the MLA index. The research aims to test if the MLA index varies across income levels
This document provides an introduction to macroeconomics. It defines macroeconomics, discusses key questions in the field, and outlines different schools of thought regarding the appropriate role of government intervention in the economy. The document also summarizes different economic goals and debates around activist versus non-activist policy approaches.
The document discusses the concepts of inflation and the Phillips curve. It provides background on the Phillips curve, originally proposed in 1958, which suggested an inverse relationship between inflation and unemployment. It also discusses how the Phillips curve relationship broke down in the 1970s with the occurrence of stagflation, where inflation and unemployment rose simultaneously. The document explores potential reasons for shifts in the Phillips curve over time.
- Real interest rates in the US are currently at their most negative level in almost three decades, which is an important development that should not be ignored by investors.
- Historically, periods of deeply negative real rates have typically been followed by improvements in leading economic indicators and increased spending, consumption, and demand for assets by both consumers and businesses.
- Based on historical relationships, the current negative real rate environment suggests that US economic prospects and equity markets may find increased support and possibly a sustained rally in the coming year.
Skirting the Abyss: From Economic Downturn to Financial Crisis to Long-term M...Llinlithgow Associates
We came right up to the edge of the economic abyss after a year of an accelerating economic downturn and have managed to avoid it but are not out of the woods yet. The risks of a double-dip are growing but the likelihood of a weak recovery and poor job creation is high. A key problem is and was the financial crisis and credit market collapse which has created major lingering problems that will be with us for years. Beyond that a two-decade over-accumulation of debt, drastic declines in Savings and under-Investment have created long-term problems for getting back to sustainable long-term growth. Here we survey the current state of the economy, wade thru the details of the Financial crisis, especially the role of Synthetic Structured Debt and the business performance of the Finance Industry. Then we roll forward to examine the long-term damages created, how we need reduce private debt and what our prospects for reduced long-term growth are. Or, given the decisions to invest in our future and address broader policy problems, how we can return to a path of longer-term high growth and prosperity.
This document provides an overview and review for an exam covering macroeconomics chapters 10-16. It includes summaries of key topics like the problems of macroeconomics, stock markets, types of firms, unemployment, inflation, aggregate supply and demand modeling, monetary policy tools, and transmission mechanisms. The Federal Reserve and its role in using tools like open market operations, the discount rate, and reserve ratio to influence money supply and achieve its mandates of stable prices and maximum employment are discussed.
Does economic development require more income inequalityAlexander Decker
This document discusses the relationship between income inequality and economic growth, and whether the Kuznets curve is still valid. It provides background on the Kuznets curve hypothesis that income inequality initially increases with economic growth but then decreases after a certain income threshold is reached. The document reviews measures of income inequality like the Lorenz curve and Gini coefficient. It also surveys literature on the relationship between income inequality and growth, finding conflicting conclusions. Some empirical studies show inequality positively correlates with growth, while others show a negative correlation. The document discusses arguments on both sides of the debate and concludes that the relationship depends on countries' development levels and policies.
The document defines and explains recession. It notes that a recession is when a country's GDP declines for two consecutive quarters, indicating the economy is shrinking. Recessions can be caused by overproduction when supply exceeds demand, or by a loss of consumer and business confidence from factors like job losses and company bankruptcies that further reduce spending and demand. Governments try to counter recessions through fiscal policies like tax cuts and increased spending, and monetary policies where central banks lower interest rates and adjust money supply to boost demand and investment.
1) Macroeconomics investigates relationships between different economic sectors and the effects of changes in variables like consumption, investment, government spending, and net exports. Its goals are full employment, price stability, and economic growth.
2) Inflation is defined as a sustained rise in the general price level. It redistributes purchasing power arbitrarily and distorts price signals. The real interest rate is the nominal rate minus the inflation rate.
3) Economic growth is measured by the annual percentage change in real GDP. Strong growth generates employment while avoiding inflation.
This document provides an overview of key concepts in economics. It defines economics as concerned with efficient use of scarce resources to satisfy unlimited human wants. It describes the economic perspective as focused on scarcity, rational behavior, and marginal analysis of costs and benefits. It explains that economics uses the scientific method and theoretical and policy approaches. It distinguishes between microeconomics which examines specific units, and macroeconomics which examines the economy as a whole. The document also covers positive versus normative economics and potential pitfalls to objective economic thinking.
This document discusses challenges facing Americans in retirement planning and proposes solutions to help ensure adequate lifetime income. It notes that entitlement costs will rise significantly, replacement rates from Social Security are declining, and many lack workplace retirement plans, leaving a growing gap in assured retirement income. While defined contribution savings plans have grown substantially, risks like market volatility and inflation still threaten to erode savings. The document proposes new retirement plan designs that incorporate guaranteed lifetime income options and advice, and move beyond just asset accumulation to address distribution challenges in retirement.
The document discusses several challenges facing the US economy that contradict the view that it can decouple from global economic trends. It argues that the Federal Reserve's quantitative easing policies had less impact on interest rates than commonly believed, and that interest rates were destined to fall due to a global capital glut. It also argues that the US employment situation indicates long-term problems like declining labor force participation and increasing low-wage jobs. Additionally, it states that household debt remains high and deflation is a global issue impacting the US through factors like a strong dollar.
The document discusses whether the US economy has truly recovered from the Great Recession. While GDP and corporate profits have increased since the recession, the author argues that the quality of life for most Americans, especially the bottom 99%, has not significantly improved or has deteriorated. Unemployment rates only consider those actively looking for work and do not account for discouraged workers, and labor participation is at a 38-year low. The author believes inequality has increased and many Americans remain unemployed or underemployed, indicating the economy has not fully recovered for most.
- The document analyzes whether returns on the S&P 500 are significantly lower in the month of October compared to other months, a phenomenon known as the "October effect."
- Statistical analysis of monthly S&P 500 returns from 1926-2012 finds no significant evidence that returns are lower in October specifically. However, returns are found to be lower during autumn months in general, suggesting the effect may be due to normal seasonal variations.
- While monthly returns are shown to be somewhat predictive of subsequent year returns, returns in October are not found to be any more predictive than other months. The analysis does not support the idea that October is an unusually dangerous month for investors.
This document provides a 3-paragraph summary of the U.S. economic outlook by Mike Lathigee, Chairman and CEO of Alliance Investment Solutions:
1) Government stimulus money is fading and budget cuts at the federal and state/local levels could further hamper economic growth. Consumer spending rose less than expected and state/local budget cuts reduced spending. Additionally, rising oil prices and inflation pose risks to the recovery.
2) Economic growth needs to be stronger to significantly reduce the 9% unemployment rate, yet budget cuts could constrain growth. A showdown in Congress over the budget threatens a government shutdown, adding uncertainty.
3) Inflation rose 1.6% overall and 0.2%
This chapter introduces three basic macroeconomic relationships: 1) the income-consumption and income-saving relationships, 2) the relationship between the interest rate and investment, and 3) the multiplier concept relating changes in spending to changes in output. It provides details on consumption and saving schedules, average and marginal propensities to consume and save, and how nonincome factors can shift these schedules. It also discusses how the expected rate of return and real interest rate determine an investment demand curve.
Neri conference 2015 income volatility and economic securityJason Loughrey
This document summarizes Jason Loughrey's presentation on constructing an economic security index for Ireland. It discusses measuring household income volatility in Ireland from 2006-2012 using survey data. Income volatility was highest for households in the bottom third of the income distribution and increased during the recession. The document also outlines the components of an economic security index, including a household's ability to maintain living standards during a 25% drop in income. Constructing such an index for Ireland is challenging due to data limitations but could provide insights into economic insecurity.
WHAT IS RECESSION - A SMALL UNDERSTANDING / MEANING Amit Jhunjhunwala
This document discusses recessions and market economics. It defines a recession as the economy shrinking for two consecutive quarters with decreasing GDP. It explains that a recession occurs when there is unwillingness to buy, leading industries like airlines and hotels to cut costs through layoffs and salary reductions. This decreases demand for other goods and can lead the economy into a depression if the recession lasts over 6 months. While developing economies like India may see slowing growth, most developed economies are currently in a recession with negative GDP growth rates. Ultimately, a recession stems from both market economics and a state of mind where fear decreases spending.
The economic data were mixed, but, generally, on the strong side of expectations. Consumer confidence improved in August. It is still relatively weak by historical standards, but moving in the right direction. Evaluations of current job availability remained depressed, but were not quite as bad as in July. New home sales rose 9.6% in July, while figures for the three previous months were revised higher. Durable goods orders jumped 4.9% in July, reflecting a spike in civilian aircraft orders (a moderately positive trend otherwise).
A recession is defined as a period of reduced economic activity where a country's GDP declines for at least two consecutive quarters. It can be caused by currency crises, energy crises, underconsumption, overproduction, or financial crises. Past recessions in the US lasted between 8 months to 2 years. During recessions, unemployment typically rises 2-3 percentage points, adding 3-5 million newly unemployed Americans. However, job losses mainly affect low-skilled workers, as skilled jobs remain available. As a recession looms, human resources management plays a strategic role in optimizing staffing, boosting productivity, managing compensation and benefits, and retaining key employees through communication and motivation.
Syz & co syz asset management - 1 month in 10 snapshots february 2013SYZBank
Every month SYZ Asset Management publishes “1 month in 10 snapshots” a review of global economic activity. Since an image can be more telling than words, every month we select 10 charts illustrating the key data that has marked economic and financial activity over the month, decoding their meaning with a brief explanation.
This document discusses whether inflation or deflation is better for a growing economy. It defines inflation, deflation, and disinflation, noting that deflation means falling prices while disinflation means slowing price increases. The document explores how deflation can occur and lists some potential causes like decreasing money supply, increasing goods supply, or falling demand. It argues that deflation from technological advances or globalization that increase efficiency can be "good" by enabling lower prices and greater consumption, while deflation in developed economies due to debt obligations can create a negative spiral.
The document discusses corporations and the stock market. It provides details on what a corporation is, how they are formed and structured, their strengths like limited liability, and examples of large profitable corporations. It also discusses the stock market, listing the largest companies by revenue and profits, defining key stock market terms, and how to read a stock table.
The document discusses the concepts of supply and demand, including the determinants and illustrations of demand and supply curves. It explains how equilibrium price and quantity are determined by the intersection of supply and demand, and how shortages and surpluses can occur when prices are above or below equilibrium. Government interventions such as price floors and ceilings are introduced, along with their unintended consequences of persistent shortages or surpluses.
This document provides an introduction to economics concepts including scarcity, choice, opportunity cost, and production possibility frontiers. It begins with a quote about not always getting what you want and explains that this is because of scarcity. It then defines economics as the study of how people make choices due to limited resources. It introduces the concept of opportunity cost and uses examples to illustrate tradeoffs. Finally, it explains production possibility frontiers and how they can be used to measure opportunity costs graphically.
Skirting the Abyss: From Economic Downturn to Financial Crisis to Long-term M...Llinlithgow Associates
We came right up to the edge of the economic abyss after a year of an accelerating economic downturn and have managed to avoid it but are not out of the woods yet. The risks of a double-dip are growing but the likelihood of a weak recovery and poor job creation is high. A key problem is and was the financial crisis and credit market collapse which has created major lingering problems that will be with us for years. Beyond that a two-decade over-accumulation of debt, drastic declines in Savings and under-Investment have created long-term problems for getting back to sustainable long-term growth. Here we survey the current state of the economy, wade thru the details of the Financial crisis, especially the role of Synthetic Structured Debt and the business performance of the Finance Industry. Then we roll forward to examine the long-term damages created, how we need reduce private debt and what our prospects for reduced long-term growth are. Or, given the decisions to invest in our future and address broader policy problems, how we can return to a path of longer-term high growth and prosperity.
This document provides an overview and review for an exam covering macroeconomics chapters 10-16. It includes summaries of key topics like the problems of macroeconomics, stock markets, types of firms, unemployment, inflation, aggregate supply and demand modeling, monetary policy tools, and transmission mechanisms. The Federal Reserve and its role in using tools like open market operations, the discount rate, and reserve ratio to influence money supply and achieve its mandates of stable prices and maximum employment are discussed.
Does economic development require more income inequalityAlexander Decker
This document discusses the relationship between income inequality and economic growth, and whether the Kuznets curve is still valid. It provides background on the Kuznets curve hypothesis that income inequality initially increases with economic growth but then decreases after a certain income threshold is reached. The document reviews measures of income inequality like the Lorenz curve and Gini coefficient. It also surveys literature on the relationship between income inequality and growth, finding conflicting conclusions. Some empirical studies show inequality positively correlates with growth, while others show a negative correlation. The document discusses arguments on both sides of the debate and concludes that the relationship depends on countries' development levels and policies.
The document defines and explains recession. It notes that a recession is when a country's GDP declines for two consecutive quarters, indicating the economy is shrinking. Recessions can be caused by overproduction when supply exceeds demand, or by a loss of consumer and business confidence from factors like job losses and company bankruptcies that further reduce spending and demand. Governments try to counter recessions through fiscal policies like tax cuts and increased spending, and monetary policies where central banks lower interest rates and adjust money supply to boost demand and investment.
1) Macroeconomics investigates relationships between different economic sectors and the effects of changes in variables like consumption, investment, government spending, and net exports. Its goals are full employment, price stability, and economic growth.
2) Inflation is defined as a sustained rise in the general price level. It redistributes purchasing power arbitrarily and distorts price signals. The real interest rate is the nominal rate minus the inflation rate.
3) Economic growth is measured by the annual percentage change in real GDP. Strong growth generates employment while avoiding inflation.
This document provides an overview of key concepts in economics. It defines economics as concerned with efficient use of scarce resources to satisfy unlimited human wants. It describes the economic perspective as focused on scarcity, rational behavior, and marginal analysis of costs and benefits. It explains that economics uses the scientific method and theoretical and policy approaches. It distinguishes between microeconomics which examines specific units, and macroeconomics which examines the economy as a whole. The document also covers positive versus normative economics and potential pitfalls to objective economic thinking.
This document discusses challenges facing Americans in retirement planning and proposes solutions to help ensure adequate lifetime income. It notes that entitlement costs will rise significantly, replacement rates from Social Security are declining, and many lack workplace retirement plans, leaving a growing gap in assured retirement income. While defined contribution savings plans have grown substantially, risks like market volatility and inflation still threaten to erode savings. The document proposes new retirement plan designs that incorporate guaranteed lifetime income options and advice, and move beyond just asset accumulation to address distribution challenges in retirement.
The document discusses several challenges facing the US economy that contradict the view that it can decouple from global economic trends. It argues that the Federal Reserve's quantitative easing policies had less impact on interest rates than commonly believed, and that interest rates were destined to fall due to a global capital glut. It also argues that the US employment situation indicates long-term problems like declining labor force participation and increasing low-wage jobs. Additionally, it states that household debt remains high and deflation is a global issue impacting the US through factors like a strong dollar.
The document discusses whether the US economy has truly recovered from the Great Recession. While GDP and corporate profits have increased since the recession, the author argues that the quality of life for most Americans, especially the bottom 99%, has not significantly improved or has deteriorated. Unemployment rates only consider those actively looking for work and do not account for discouraged workers, and labor participation is at a 38-year low. The author believes inequality has increased and many Americans remain unemployed or underemployed, indicating the economy has not fully recovered for most.
- The document analyzes whether returns on the S&P 500 are significantly lower in the month of October compared to other months, a phenomenon known as the "October effect."
- Statistical analysis of monthly S&P 500 returns from 1926-2012 finds no significant evidence that returns are lower in October specifically. However, returns are found to be lower during autumn months in general, suggesting the effect may be due to normal seasonal variations.
- While monthly returns are shown to be somewhat predictive of subsequent year returns, returns in October are not found to be any more predictive than other months. The analysis does not support the idea that October is an unusually dangerous month for investors.
This document provides a 3-paragraph summary of the U.S. economic outlook by Mike Lathigee, Chairman and CEO of Alliance Investment Solutions:
1) Government stimulus money is fading and budget cuts at the federal and state/local levels could further hamper economic growth. Consumer spending rose less than expected and state/local budget cuts reduced spending. Additionally, rising oil prices and inflation pose risks to the recovery.
2) Economic growth needs to be stronger to significantly reduce the 9% unemployment rate, yet budget cuts could constrain growth. A showdown in Congress over the budget threatens a government shutdown, adding uncertainty.
3) Inflation rose 1.6% overall and 0.2%
This chapter introduces three basic macroeconomic relationships: 1) the income-consumption and income-saving relationships, 2) the relationship between the interest rate and investment, and 3) the multiplier concept relating changes in spending to changes in output. It provides details on consumption and saving schedules, average and marginal propensities to consume and save, and how nonincome factors can shift these schedules. It also discusses how the expected rate of return and real interest rate determine an investment demand curve.
Neri conference 2015 income volatility and economic securityJason Loughrey
This document summarizes Jason Loughrey's presentation on constructing an economic security index for Ireland. It discusses measuring household income volatility in Ireland from 2006-2012 using survey data. Income volatility was highest for households in the bottom third of the income distribution and increased during the recession. The document also outlines the components of an economic security index, including a household's ability to maintain living standards during a 25% drop in income. Constructing such an index for Ireland is challenging due to data limitations but could provide insights into economic insecurity.
WHAT IS RECESSION - A SMALL UNDERSTANDING / MEANING Amit Jhunjhunwala
This document discusses recessions and market economics. It defines a recession as the economy shrinking for two consecutive quarters with decreasing GDP. It explains that a recession occurs when there is unwillingness to buy, leading industries like airlines and hotels to cut costs through layoffs and salary reductions. This decreases demand for other goods and can lead the economy into a depression if the recession lasts over 6 months. While developing economies like India may see slowing growth, most developed economies are currently in a recession with negative GDP growth rates. Ultimately, a recession stems from both market economics and a state of mind where fear decreases spending.
The economic data were mixed, but, generally, on the strong side of expectations. Consumer confidence improved in August. It is still relatively weak by historical standards, but moving in the right direction. Evaluations of current job availability remained depressed, but were not quite as bad as in July. New home sales rose 9.6% in July, while figures for the three previous months were revised higher. Durable goods orders jumped 4.9% in July, reflecting a spike in civilian aircraft orders (a moderately positive trend otherwise).
A recession is defined as a period of reduced economic activity where a country's GDP declines for at least two consecutive quarters. It can be caused by currency crises, energy crises, underconsumption, overproduction, or financial crises. Past recessions in the US lasted between 8 months to 2 years. During recessions, unemployment typically rises 2-3 percentage points, adding 3-5 million newly unemployed Americans. However, job losses mainly affect low-skilled workers, as skilled jobs remain available. As a recession looms, human resources management plays a strategic role in optimizing staffing, boosting productivity, managing compensation and benefits, and retaining key employees through communication and motivation.
Syz & co syz asset management - 1 month in 10 snapshots february 2013SYZBank
Every month SYZ Asset Management publishes “1 month in 10 snapshots” a review of global economic activity. Since an image can be more telling than words, every month we select 10 charts illustrating the key data that has marked economic and financial activity over the month, decoding their meaning with a brief explanation.
This document discusses whether inflation or deflation is better for a growing economy. It defines inflation, deflation, and disinflation, noting that deflation means falling prices while disinflation means slowing price increases. The document explores how deflation can occur and lists some potential causes like decreasing money supply, increasing goods supply, or falling demand. It argues that deflation from technological advances or globalization that increase efficiency can be "good" by enabling lower prices and greater consumption, while deflation in developed economies due to debt obligations can create a negative spiral.
The document discusses corporations and the stock market. It provides details on what a corporation is, how they are formed and structured, their strengths like limited liability, and examples of large profitable corporations. It also discusses the stock market, listing the largest companies by revenue and profits, defining key stock market terms, and how to read a stock table.
The document discusses the concepts of supply and demand, including the determinants and illustrations of demand and supply curves. It explains how equilibrium price and quantity are determined by the intersection of supply and demand, and how shortages and surpluses can occur when prices are above or below equilibrium. Government interventions such as price floors and ceilings are introduced, along with their unintended consequences of persistent shortages or surpluses.
This document provides an introduction to economics concepts including scarcity, choice, opportunity cost, and production possibility frontiers. It begins with a quote about not always getting what you want and explains that this is because of scarcity. It then defines economics as the study of how people make choices due to limited resources. It introduces the concept of opportunity cost and uses examples to illustrate tradeoffs. Finally, it explains production possibility frontiers and how they can be used to measure opportunity costs graphically.
The document discusses the costs of attending both public and private colleges in the United States. It states that for in-state students at a public college, tuition and fees for four years will be over $100,000, increasing at 5% per year. For out-of-state students or those attending a private university, the costs for four years including tuition, fees, room and board will be over $200,000, also increasing at 5% annually. The document also covers topics around savings, capital formation, and the financial system.
The document discusses corporations and the stock market. It provides details on what a corporation is, how they are formed and structured, their strengths like limited liability, and examples of large profitable corporations. It also discusses the stock market, listing the largest companies by revenue and profits, defining key stock market terms, and how to read a stock table.
This document provides an overview of economics concepts covered across 5 units:
1) It introduces the basic questions of economics - what, how, and for whom to produce goods and services. Governments and markets answer these questions differently.
2) Supply and demand are explained, including the laws of supply and demand and elasticity. Market equilibrium is analyzed using supply and demand graphs.
3) Different forms of business organization like sole proprietorships and corporations are covered, along with stocks, bonds, and entrepreneurship.
4) Macroeconomic indicators like GDP, inflation, and the business cycle are defined. The stages of the business cycle are explained.
5) Tools for managing the economy are outlined
The document provides an overview of key concepts in economics, including:
1) Economists study how to meet unlimited wants with scarce resources by analyzing trade-offs and opportunity costs.
2) Production possibility frontiers and opportunity costs demonstrate the trade-offs of allocating resources.
3) Different economic systems answer questions about what, how, and for whom to produce in different ways, such as through tradition, government command, or market forces.
4) Supply and demand determine prices in a market economy through the interaction of producers and consumers.
Study: The Future of VR, AR and Self-Driving CarsLinkedIn
We asked LinkedIn members worldwide about their levels of interest in the latest wave of technology: whether they’re using wearables, and whether they intend to buy self-driving cars and VR headsets as they become available. We asked them too about their attitudes to technology and to the growing role of Artificial Intelligence (AI) in the devices that they use. The answers were fascinating – and in many cases, surprising.
This SlideShare explores the full results of this study, including detailed market-by-market breakdowns of intention levels for each technology – and how attitudes change with age, location and seniority level. If you’re marketing a tech brand – or planning to use VR and wearables to reach a professional audience – then these are insights you won’t want to miss.
The document discusses aggregate demand and aggregate supply models. It provides explanations of:
1) Why economists model the economy using AD/AS curves to understand business cycles and potential policy solutions.
2) The components that can cause shifts in aggregate demand and aggregate supply such as consumer spending, investment, government spending, input costs, and technology.
3) How the AD and AS curves interact to determine equilibrium output, unemployment, and inflation in both the short-run and long-run.
Join us for the fourth quarter economic outlook webinar with Dr. Joe Webb, sponsored by MindfireInc. With an increasingly confused economic environment, Dr. Webb has the right prescription for navigating these rocky waters. Topics to be discussed include:
* The latest economy fun & games going into the election, and the first look at 2009's economy
* The print economy as the industry prepares for Graph Expo
* The latest survey of print businesses and their planned end-of-year actions
* Technology trends to watch for in 2009 and 2010
* Fall into Fall with Dr. Joe’s reading list
The document provides an overview of macroeconomic concepts including the circular flow of income, aggregate demand, aggregate supply, macroeconomic problems like inflation and unemployment, macroeconomic policy objectives and instruments like monetary and fiscal policy. It defines key terms and concepts and outlines the relationships between different macroeconomic variables and sectors of the economy at a high level.
Taxes, Deficit Spending, And The GovernmentJessica Clark
The document discusses several topics related to taxes, government spending, deficits, and macroeconomics. It defines key terms like the payroll tax system, tax brackets, government spending priorities, deficit spending, and how deficits can redistribute wealth. It also explains aggregate supply and demand curves and how fiscal and monetary policy can be used to address economic instability.
Understand the four phases of the business cycle and explain the primary characteristics of recessions and expansions using leading, coincident and lagging indicators
Use potential output and the output gap to analyze an economy's position in the business cycle.
Understand the aggregate demand and aggregate supply curves, and factors causing their shift
The document provides an overview of macroeconomic policies and concepts including:
1) It discusses the business cycle and macroeconomic equilibrium and how disturbances can cause instability.
2) Keynes argued that government intervention is necessary to address inherent instability in free markets. Fiscal and monetary policies can be used to stimulate aggregate demand.
3) Supply-side policies aim to shift aggregate supply curves by incentivizing production. Both demand and supply factors influence macroeconomic outcomes like growth, unemployment and inflation.
The presentation investigates whether the Federal Reserve can possibly manage asset bubbles (real estate, stocks) in addition to managing its primary goals (inflation, sustainable growth).
The document discusses business cycles and fluctuations in economic growth. It notes that a business cycle consists of expansions and contractions in most economic activities over time, varying in length from over a year to around a decade. It also discusses indicators used to predict and describe business cycles, such as leading, lagging, and coincident indicators tracked by organizations like the Conference Board and Bureau of Labor Statistics.
Copy of A LEVEL Business External Economic Influences on Business Behaviour (...Samson Mwaghore
This document discusses external economic influences on business behavior. It begins by outlining key economic concepts like GDP, inflation, unemployment, and exchange rates. It then explains governments' macroeconomic objectives of economic growth, low inflation, low unemployment, and exchange rate stability. The document discusses the business cycle and how businesses can adapt their strategies during periods of economic growth versus recession through pricing, promotions, and product differentiation. It also covers the concept of income elasticity of demand and how demand for products responds differently to changes in consumer incomes.
The document discusses different options for dealing with the upcoming "fiscal cliff" in the US: A) getting pushed over the cliff through abrupt spending cuts and tax increases, B) jumping at the chance to strike a "Grand Bargain" through a large deficit reduction deal, or C) stepping back to think about the issues and consider alternative approaches. It argues that options A and B could harm the economy in the short-run and that there is no economic reason to rush into a large deficit reduction given that the US government has fiscal space as the issuer of the currency.
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McKinsey’s Ten Guiding Principles of Digital Transformation
Forrester’s Digital Transformation Framework
IDC’s Digital Transformation MaturityScape
MIT’s Digital Transformation Framework
Gartner’s Digital Transformation Framework
Accenture’s Digital Strategy & Enterprise Frameworks
Deloitte’s Digital Industrial Transformation Framework
Capgemini’s Digital Transformation Framework
PwC’s Digital Transformation Framework
Cisco’s Digital Transformation Framework
Cognizant’s Digital Transformation Framework
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The BCG Strategy Palette
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Digital Transformation Compass
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2. Your Task
« You will be put into groups of 4 – 5
« Each group will be assigned one type of tax
« You will use your textbook and notes to complete
a poster that follows all of the assignment.
« You will then create a ‘poster’.
« This poster will be used to ‘teach’ the class
the information from your tax.
« Your poster should include the tax,
description, examples, pictures, and other
unique techniques that will make it easy and
exciting for your classmates to learn the
information.
9. Deficit Spending
Deficit spending occurs when…
Government spends more than is
collected in revenues
Persistent deficits…
Contribute to the inflationary spiral
(What is inflation?)
10. Why might deficit spending
occur?
Scenario 1:
Weak economy causes high unemployment
Outcome: Less revenue comes in from taxes
Scenario 2:
Increased spending on transfer payments
Outcome: Government is providing payment but
receiving neither goods nor services in
return
11. Consequences of
the National Debt
Scenario:
Government needs more revenue
Action:
↑ Taxes = ↓ Consumer Purchasing Power
Consequence:
The incentive to work is reduced if it means an
individual will have to pay more taxes
12. Crowding-Out Effect
Scenario
Deficit spending by the government
Government Action
Sells bonds (borrows $) to finance the deficit
Individual Action
People will buy government bonds instead of
corporate bonds (SAFER)
Impact on Investment Spending (“I” Sector of GDP)
Corporations are “crowded-out” because government
spending forces investment spending to contract.
14. 1. Some people believe we should have a 15%
tax rate on all personal income, regardless of
one’s level of total income.
What type of tax is this?
2. Which reason best explains why the federal
government might reduce taxes?
a) Finance defense research
b) Slow inflation and create a recession
c) Increase consumer spending and stimulate the
economy
15. 3. According to the “ability-to-pay” concept,
who should pay higher taxes?
4. Why should we be concerned about a
persistent deficit in the national budget?
a) Deficits reduce inflation
b) Deficits contribute to inflation
c) Deficits stimulate the economy
5. Explain the “crowding-out” effect in your
own words?
16. Warm-Up … Web Quest
Work within your groups to complete the web
activity.
Everyone needs to complete one.
Time Limit: 3o minutes
18. Web Quest Groups
Question 1 Question 2 Question 3
Question 4 Question 5 Question 6
19. Explain the concepts of aggregate supply
and aggregate demand, and how they are
used to determine macroeconomic
equilibrium
Aggregate = TOTAL
We are talking about “total” supply and
demand economy-wide … not just the supply
and demand for 1 product (i.e., Nintendo Wii)
20. Define Aggregate Supply {AS}
Total supply economy-wide
Aggregate Supply Curve
Shows the quantity of real GDP (RGDP) that would be
produced at various price levels.
Shifts in the AS Curve
changes in the cost of inputs
(any cost that would cause firms to offer more or less
goods for sale at EVERY price) ↓ cost of inputs
↑cost of inputs
leftward shift rightward shift
21. Define Aggregate Demand {AD}
Sum of demand for ALL economic units in the economy
Aggregate Demand Curve
Shows the quantity of RGDP purchased at each possible
price level by 3 main sectors of spending (C, I, G)
↑spending ↓ spending
Shifts in the AD Curve
rightward shift leftward shift
Spending v. Saving
(Any situation that would increase or decrease the amount of
money consumers, businesses, government have to spend.)
22. Macroeconomic Equilibrium
Where AD and AS intersect
Both purchasers and producers are happy!
“BIG PICTURE” measures aggregate (total)
spending and production economy-wide~!
23. When eGDP
increases, more
jobs are being
created and the
economy is
GROWING
When ePL
increases,
general price
levels are going
up (INFLATION)
24. When eGDP
decreases, jobs
are being lost
and the
economy is
SHRINKING
When ePL
decreases,
general price
levels are going
down
(DEFLATION)
25. When eGDP
increases, jobs
are being
created and the
economy is
GROWING
When ePL
decreases,
general price
levels are going
down
(DEFLATION)
26. Your Turn…
Please complete the graphing activity
Be sure to label ALL parts of the graph!
27. Create Your Own…
Something/Something
Please work with a group of 3-4.
Create a riddle, poem, or rap that explains
aggregate demand/aggregate supply and
their relationship with macro-economy
equilibrium.
You have 15 minutes to prepare.
Please be ready to present to the class.
28. Headliner Activity
Assume the role of a news reporter for the Wall
Street Journal (or another business news
publication).
Create a HEADLINE for a front-page story that
would reflect/apply concepts learned today.
Write a 4-6 sentence “report” about the scenario
described, and create an AS/AD curve illustrating
the shifts that would occur due to the situation.
Be sure to explain what would happen to productivity,
unemployment, and prices in the economy
BASED ON THE CHANGES IN eGDP and ePL.
30. Demand-Side Policies
Policies designed to ↑ or ↓ AD
(shift the AD curve)
Fiscal Policy: the government’s attempt to
stabilize the economy through taxing and
government spending
Derived from Keynesian economics…
31. Keynesian Economics
C + I + G + X-IM = GDP
Specifically focused on the idea that a change in
“C” or “I” would cause economic instability (↓ GDP)
If there is not enough consumer spending or
investment spending, the government can intervene
to ↑ AD
↓ taxes (stimulates “C”)
↑ government spending
This is occurring TODAY in our economy!
Recall Obama’s Economic Stimulus Plan
32. “Expansionary” Fiscal Policy
Used to fight unemployment…
↑ Government Spending (“G”)
↓ Taxes [indirectly affects “C”]
Problem:
↑ AD will ↑ GDP and ↑ PL
…this causes inflation
34. “Contractionary” Fiscal Policy
Used to fight inflation…
↓ Government spending (G)
↑ Taxes [indirectly affects “C”]
Problem:
↓ AD will ↓ PL (reduce inflation) and ↓ GDP
… this causes unemployment
38. Supply-Side Economics
“Best of Both Worlds”
↓ unemployment and ↓ inflation
Policies designed to stimulate output (rGDP) by
increasing production (AS curve shifts right)
↓ Taxes ⇒ ↑ AS
Result, ↑ GDP and ↓ PL
41. Limitations of
Supply-Side Policies
Difficult to predict how Supply-Side policy will
affect the economy
Polices would likely restore long-run economic
growth, not short-run instability (like today!)
44. Group Think
Form 4 groups
1.
Each group will receive 1 item
2.
Identify 2 functions of the item
3.
45. What are the functions of money?
Why do we need money?
46. Functions of Money
Medium of exchange: you don’t want money
for what it is…you want money because it buys
things!
Unit of Account: identifies the cost of something
In the U.S., prices are recorded in dollars and cents
Store of Value: it keeps its purchasing power
over time…though PP declines with inflation
47. Considering the functions of money,
why has it been called so many names?
Loot
Booty
Cabbage
Dough
Bread
Moola
49. What serves effectively as money?
Commodity Money: money that has an alternative
use as an economic good / commodity
Examples?
Fiat Money: money that has no alternative use as a
commodity
Examples?
50. M1 v. M2
M1 = money as a medium of exchange
● Money you “hold” and can walk into a store and use
right away
● Examples?
M2 = money as a store of value
M1 + money market deposit accounts, money
market mutual funds, and savings accounts
51. What is Liquidity?
The ease with which an asset can be converted into
cash.
What is the most liquid asset?
52. Fractional Reserve Banking
Banks are required to keep only a “fraction” of their
deposits in reserves.
10% reserve requirement today
Example
If you deposit $100 into your checking
account, $10 must be put in the vault…but the
other $90 is “excess reserves”.
This money is lent out to others who are seeking a
loan.
53. Auto Loan Web Quest:
How does monetary policy
affect my personal finance?
53
54. Exit Ticket
• Reflect on today’s activity
–What did you learn about the
impact of monetary policy on the
economy?
–What did you learn about the
impact of monetary policy on you
personally?
–What did you enjoy most?
54
55. Warm-Up: Invent “new” Money
Turn to the person seated next to you.
Together, you will “invent” new money, showing how
it fulfills the 3 functions in the same way gold does.
Function Gold as Money YOUR item as Money
Medium of Exchange Acceptable as a
Will it be accepted by users? Medium of Exchange,
Does it meet the and gold ore is limited
characteristics of money? in supply
Unit of Value Measurement is
Can it be used to establish determined by size and
the value of many things? purity
Store of Value
Durable – it will not
Can it be stored easily?
fade or erode
Does it retain value?
56. The Need for Monetary Policy
Too much money in supply
can cause inflation
57. Big Idea
Key word to understand:
Interest rate: A rate which is charged or paid
for the use of money.
58. The Federal Reserve
America’s Central Bank
Responsible for making sure
that the nation’s money supply
grows at the appropriate rate
59. Photo Trivia
Who is this guy?
Why is this building significant?
60. America’s Central Bank: ‘The Fed’
Established in 1914
Created to lend to other banks in times of need
(controls money supply)
61. Organization of the FED
Goal: to provide a safer, more flexible banking and
monetary system without interference of political
pressures.
Independent agency of the United States government
7 member Board of Directors in Washington D.C.
12 Districts Banks
65. Implementing Monetary Policy
Monetary Policy:
Expansion or contraction of the money supply to
influence the cost and availability of credit (loans).
The Fed uses four [4] major tools of MP to affect the
amount of excess reserves in the system
This impacts
Rates: the cost of credit
Interest
Money Supply: the availability of credit
66. Two Types of Monetary Policy
‘Loose’ Monetary Policy
Used to stimulate the economy
Action: ↑ MS and ↓ IR
↑ eGDP and ↓ unemployment
Goal:
Bottom Line,
Low interest rates encourage borrowing by
consumers and businesses
67. Two Types of Monetary Policy
‘Tight’ Monetary Policy
Used to slow the economy
Action: ↓ MS and ↑ IR
Bottom Line,
High interest rates slow economic growth because
consumers and businesses borrow less
68. 4 Tools of Monetary Policy
Federal Funds Rate
Discount Rate
Reserve Requirement
Open Market Operations
69. Fed Funds Rate (FFR)
Interest rate banks charge when they borrow from
each other
FFR is set by the Fed
↓ FFR
Banks will be more likely to take loans from other banks
Money from loan transactions goes into E.R.
Result,
↑ ER = ↑ Loans = ↑ MS = ↓ I.R.
70. Fed Funds Rate
↑ FFR
Banks are likely to pay loans back to other banks
Money used to pay back loans comes from E.R.
Result,
↓ ER = ↓ Loans = ↓ MS = ↑ I.R.
71. FFR and the Prime Rate
Prime Rate is the basis for many loans
including home equity loans, auto loans
and credit cards
The rates on these types of loans will change when
the Fed changes the FFR
↓ FFR = ↓ Prime Rate
● Result, Consumers
will borrow more
72. Summary ~ Tools of MP
Tool of MP Δ in MS Δ in IR
Open Market Operations
↑ MS ↓I.R.
Buying Bonds
↓ MS ↑ I.R.
Selling Bonds
Discount Rate
↑ the D.R. ↓ MS ↑ D.R.
↓ the D.R. ↑ MS ↓ D.R.
Reserve Requirements
↑ the R.R. ↓ MS ↑ R.R.
↓ the R.R. ↑ MS ↓ R.R.
Federal Funds Rate
↑ the F.F.R. ↓ MS ↑ I.R.
↓ the F.F.R. ↑ MS ↓I.R.
73. Summary ~ Tools of MP
Tool of MP Δ in MS Δ in IR
Open Market Operations
Buying Bonds
Selling Bonds
Discount Rate
↑ the D.R.
↓ the D.R.
Reserve Requirements
↑ the R.R.
↓ the R.R.
Federal Funds Rate
↑ the F.F.R.
↓ the F.F.R.
74. Monetarism
A doctrine of economic thought which places
primary importance on the role of money and its
growth
Monetarists believe that fluctuations in MS can lead
to inflation and unemployment
View: The problem of inflation and
unemployment would be helped by steady
growth in money supply
75. Current Event 3-2-1
3 THINGS YOU LEARNED
2 THINGS YOU WANT TO
KNOW MORE ABOUT
1 THING THAT
WORRIES YOU
76. Current Event
Pair - Share
FIND A PARTNER
TOGETHER, SHARE YOUR RESPONSES FOR
THE CURRENT EVENT READING
WORK TOGETHER TO DEVELOP A 3
SENTENCE DESCRIPTION OF THE ARTICLE
AND HOW IT IS RELEVANT TO
EVERYDAY LIFE AND THE MATERIAL
WE ARE LEARNING IN THIS CLASS
BE PREPARED TO SHARE
77. Video Analysis - The FED
As you watch the video, record the three primary
responsibilities of the FED that help maintain a strong
economy.
Briefly explain what each responsibility entails
Jot down ways you will remember how the tools of MP
affect money supply and interest rates in the economy,
based on this video
78. How much money would you have if you had
one of each of these bills and coins?
Lincoln Bill _________ Lincoln Coin _________
Jefferson Coin _________ Franklin Bill _________
Washington Bill _________ Kennedy Coin _________
Washington Coin _________ Grant Bill _________
Hamilton Bill _________ Roosevelt Coin _________
TOTAL _________
79. In an increasing globalized world and
integrated economy, it is essential that you
have an understanding of the U.S. currency
and money system in relation to other
counties.
As a result of Globalization, you must
understand the significance of foreign exchange
and currencies, and how the value of the U.S.
dollar compares to other countries and has
changed over time!
80. The Unveiling of the new five dollar
http://www.moneyfactory.gov/newmoney/flash/5Currency/unveil5new.html
Interactive five dollar bill
http://www.moneyfactory.gov/newmoney/main.cfm/currency/interactiveNot
es
New security features of the five dollar bill
http://www.moneyfactory.gov/newmoney/main.cfm/currency/new5
Counterfeiting of money
http://www.secretservice.gov/money_detect.shtml
85. 1. Your Thoughts…
• Did you like this activity?
• Did you learn anything new?
• Anything interesting?
• Is there anything you want to learn more
about?
We are living in an increasingly globalized
economy…you need to stay informed!
Economic changes around the world impact you…
86. Tools of Monetary Policy Money Supply Interest Rates
Admit Open Market Operations
Ticket - The Fed buys bonds
- The Fed sells bonds
Discount Rate
- ↑ the D.R.
- ↓ the D.R.
Reserve Requirements
- ↑ the R.R.
- ↓ the R.R.
Fed Funds Rate
- ↑ the F.F.R.
- ↓ the F.F.R.
1. When we want to stimulate the economy, which type of
monetary policy would be implemented?
2. What would this type of monetary policy do to money
supply and interest rates?
3. What is the result of this change in interest rates on the
borrowing habits of consumers and businesses? Why? 86
87. Monetary Policy Jubilee
Your assignment is to work with your
group members to create a poster that
captures the key features of the FED’s
tools of monetary policy. This will allow
you to look more deeply into how changes
in the tools of monetary policy impact
money supply and interest rates, and
ultimately the demand for credit (loans)
by people like you!
88. Your Poster Must…
Include illustrations and text that creatively highlight each of
the four [4] tools of monetary policy, and how
increases/decreases in the tools would affect money supply
and interest rates in the economy – 8 points (2 points / tool)
Include ILLUSTRATIONS of how changes in interest rates
affect the amount of loans people want
(HINT – what happens to the cost of borrowing when interest
rates change) – 4 points
Include a Portrayal of the beliefs of Monetarists in a way that
you will remember for the quiz and final exam – 2 points
Be in color – 2 points
89. You Must…
Work collaboratively with your group – 3 points
Use your time wisely; finishing within the time
limit – 3 points
Be creative – 3 points
Points will be deducted if you simply re-write your
notes on the poster board.
This assignment is asking you to synthesize what you
have learned and review it in a meaningful way that
will ultimately ensure success on the course
assessment.