Principles of Macroeconomics Day 2 Dr. Andrew L. H. Parkes “A Macroeconomic Understanding for use in Business” 卜安吉

September 9, 2010Principles of Macroeconomics, Day 22 Finish Chapter 23 & 24 NIPA Accounts – Income and Expenditures – real GDP, etc. NIPA Accounts – Income and Expenditures – real GDP, etc. Growth rate calculations Growth rate calculations Consumer Price Index Consumer Price Index

September 9, 2010Principles of Macroeconomics, Day 23 Infrastructure is the basic physical and organizational structures needed for the operation of the services and facilities necessary for an economy to function. is the basic physical and organizational structures needed for the operation of the services and facilities necessary for an economy to function. Airport infrastructure, Military infrastructure, Critical Infrastructure, … Airport infrastructure, Military infrastructure, Critical Infrastructure, …

September 9, 2010Principles of Macroeconomics, Day 24 Infrastructure Critical Infrastructure is considered that which is essential and thus damageable by a typhoon, earthquake, flood, etc. Critical Infrastructure is considered that which is essential and thus damageable by a typhoon, earthquake, flood, etc. Electricity, gas, water, telecommunication, agriculture, heating, public health, transportation, financial services, police and fire protection services… Electricity, gas, water, telecommunication, agriculture, heating, public health, transportation, financial services, police and fire protection services…

September 9, 2010Principles of Macroeconomics, Day 25 Infrastructure

September 9, 2010Principles of Macroeconomics, Day 26 Chapter 24 continued Midterm Exam: Values of the indicators of the 3 Goals of Any Macroeconomy Midterm Exam: Values of the indicators of the 3 Goals of Any Macroeconomy For example: 0.4% for the CPI for the U.S. in August 2009 For example: 0.4% for the CPI for the U.S. in August 2009 Also note the “year over year” rates of inflation % Also note the “year over year” rates of inflation % Personal Savings revisions

September 9, 2010Principles of Macroeconomics, Day 27 Chapter 24 Pay attention to the definition of the CPI in class! Pay attention to the definition of the CPI in class! CPI in U.S. is what? CPI in U.S. is what? Cost of Living is measured by the CPI Cost of Living is measured by the CPI U.S. Department of Labor Bureau of Labor Statistics

September 9, 2010Principles of Macroeconomics, Day 28 Cost of Living Adjustment 1. Substitution Bias 2. Introduction of new goods 3. Unmeasured quality changes 4. Typical Average Family Four problems with using the CPI for a Perfect measure of a COLA