ECON 1115 Study Guide - Midterm Guide: Gdp Deflator, Nominal Rigidity, Business Cycle
Document Summary
Econ notes test prep for test 2 (chap. No national income accounting stuff on test. Divide by inflation (gdp deflator) to get rgdp. Gdp deflator (a price index) is calculated by dollar value of goods in current year/dollar value of goods in the base year x100. Supply (if it affects the cost) and demand side shocks (if it affects spending) End of recession is when the gdp begins going up. Current unemployment rate is 4. 9% (we are at full employment) Price inertia (price stickiness) one of the causes of the business cycle. We don"t have to know the rule of 70. 70% is consumer spending, government spending is 25%, investment spending 10%, import? is -5% Right now society is more concerned with the present (which is not good)
