MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The negative relationship between unemployment and inflation is known as the A) aggregate supply curve. B) aggregate demand curve. C) efficiency wage line. D) Phillips curve. 2) Friedman and Phelps suggested that there should not be a stable relationship [...]
Demand-Pull inflation is caused when people have too much money to spend on a scarce amount of goods. For example, if the government were to increase the minimum wage to 15 dollars and hour then everyone would have more money. But more money does not mean that there are more goods or resources to produce [...]
Every economic system must answer these five questions effectively or the system itself is ineffective. 1. What goods does the economy produce? For capitalism the answer is simply “Whatever the people are willing to buy.” Since capitalism is driven solely by self interest anything that can be produced at a profit will be produced. In [...]
The Eight steps to economic recovery are… 1. Government increases spending. CHECK! 2. Stock market rises. CHECK! 3. Bond yields rise. CHECK! 4. Consumer spending stops falling or begins to rise. Sort of CHECK! 5. Housing market begins to recover. 7. Interest rates increase. 8. Unemployment returns to normal. This is what the consumer price [...]
May 252009
Most people think that they understand interest rates, when in reality they do not. The interest rates you receive at a bank is more than just a number. They are extremely important, and without interest rates our economy would be more of a roller coaster than it already is. In economic terms, the interest rate [...]
An updated version of this article can be found at my new blog HERE. Every economic system has to answer the following five questions. 1.What does the economy produce? Whatever people are willing to buy. 2.How does the economy produce it? The most efficient/cheapest way. 3.Who gets the goods? Whoever wants it and can afford [...]
My first Macroeconomics test is coming up on the 21st. I need to cover all of chapter 2 and 3 today. As well as start on the extra credit. My professor says that the class will need it. I also missed the first day of class due to jury duty, now I have to email [...]
May 192009
One of the biggest economic issues that the everyday person deals with is how to spend their fixed income in order to obtain the most satisfaction and utility. The American populace in general tends to be uneducated when it comes to financial decisions and efficiency. I’m not saying that I am any better than they are [...]
May 192009
Taking a Macroeconomics course over the summer. It’s a six week course, so I expect it be very fast paced. Already did my first current event paper one week into the class. If your interested, here is the paper I had to write it on.
This class will definitely pay off when it comes to changing the way i think about the economy and stock prices. The biggest issue about managing the economy is the fact that…