A rise in the macro price level Measured by calculating the Inflation rate of a price index Inflation rates differ across countries Measured Quarterly/Monthly/Weekly.

Slides:

Advertisements

Similar presentations

The CPI and the Cost of Living CHAPTER 7 When you have completed your study of this chapter, you will be able to C H A P T E R C H E C K L I S T Explain.

Advertisements

22 CHAPTER Monitoring Jobs and the Price Level.

The CPI and the Cost of Living CHAPTER 15 C H A P T E R C H E C K L I S T When you have completed your study of this chapter, you will be able to 1 Explain.

Copyright © 2002 Pearson Education, Inc. Slide 1.

Accounting Method for Chinas Quarterly GDP by Expenditure Approach QIU, Qiong Dept. of National Accounts, NBS.

National Economic Conditions John Weinberg August 11, 2010.

THE COMMONWEALTH FUND Figure 1. Health Insurance Coverage and Uninsured Trends Data: Analysis of the U.S. Census Bureau, Current Population Survey Annual.

How do we measure the changing value of money? Transformers: Revenge of the Fallen earned $400 million at the box office. Gone with the Wind earned $200.

Nominal GDP, Real GDP, and the GDP Deflator

The outlook for the economy – May 2011 Peter Andrews, Bank of England Construction Industry Council May 2011.

Economics 302 Lecture 2 Topics Topics Aggregate Output (Standard Measure) GDP vs GPI discussion The Other Major Macroeconomic Variables (Unemployment and.

Revision: The price level

Satoshi Imai Tsutomu Watanabe. Overview of the paper Background Data and Empirical Method Identifying the Generation Product Replacement Responsiveness.

What is Inflation? Inflation is rising general level of prices

CIA4U0 Analyzing Current Economic Issues

Mr. Bammel AP Macroeconomics Inflation (adapted from South-Western Publishing 2004) In other words… I didnt write this. I just copied and pasted.

Intermediate Macro: Measuring GDP Jeffrey H. Nilsen.

Inflation Unit Chapter 2 26

Research Department 1 Global Economic Crisis and the Israeli Economy Herzliya conference Dr. Karnit Flug Research Director, Bank of Israel February 2009.

Is it a science?.  Economics is the study of choices forced by scarcity  Almost all economic choices involve opportunity costs.

Copyright©2004 South-Western 11 Measuring the Cost of Living.

SESSION 11: MACROECONOMIC INDICATORS: GDP, CPI, AND THE UNEMPLOYMENT RATE Talking Points Macroeconomic Indicators: GDP, CPI, and the Unemployment Rate.

2.4 Index Numbers LEARNING GOAL Understand the concept of an index number; in particular, understand how the Consumer Price Index (CPI) is used to measure.

Chapter 5: Monitoring Jobs and Inflation

Economics Indicators INFLATION & THE CONSUMER PRICE INDEX (CPI)

1 1 Slide © 2008 Thomson South-Western. All Rights Reserved Chapter 17 Index Numbers n Price Relatives n Aggregate Price Indexes n Computing an Aggregate.

Chapter 2: A Tour of the BookBlanchard: Macroeconomics Slide #1 Chapter Topics Aggregate Output The Other Major Macroeconomic Variables.

Measuring Inflation and Prices Consumer Price Index (CPI)– U and R GDP Deflator –For deriving “Real GDP” Wholesale Price Index (WPI) Producer Price Index.

Measuring Inflation The Consumer Price Index. Background The Bureau of Labor Statistics (BLS) surveys 30,000 households on their spending habits. It uses.

Economics 9 weeks to go.

6.02 Understand economic indicators to recognize economic trends and conditions A Describe the economic impact of inflation on business Understand.

THE ECONOMIC INDICATORS 1.  An economic indicator is simply any economic statistic, such as the unemployment rate, GDP or the inflation rate, which indicate.

Price Stability Average level of prices in the economy is neither increasing nor decreasing.

The Measurement and Calculation of Inflation Module 15.

Slide 1 © 2002 McGraw-Hill Australia, PPTs t/a Introductory Mathematics & Statistics for Business 4e by John S. Croucher 1 Index numbers n Learning Objectives.

Contemporary Engineering Economics, 6 th edition Park Copyright © 2016 by Pearson Education, Inc. All Rights Reserved Meaning and Measure of Inflation.

PRICE AND VOLUME MEASURES NATIONAL ACCOUNTS STATISTICS WORKSHOP PRICE AND VOLUME MEASURES Workshop on national accounts for Asian member countries of the.

CHAPTER 17: Index Numbers to accompany Introduction to Business Statistics third edition, by Ronald M. Weiers Presentation by Priscilla Chaffe-Stengel.

Composite Price Index  Unweighted Aggregative method  Unweighted Average of Relatives method  Weighted Aggregative Method  Paasche Index  Laspeyres.

1 1 Slide Slides Prepared by JOHN S. LOUCKS St. Edward’s University © 2002 South-Western/Thomson Learning 

18- 1 Chapter Eighteen McGraw-Hill/Irwin © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved.

INDEX NUMBERS Definition of Index Number l A summary measure that states a relative comparison between groups of related items l Price Relative or Percentage.

Ka-fu Wong © 2003 Chap Dr. Ka-fu Wong ECON1003 Analysis of Economic Data.

GPD and Changes in Price Level Chapter 13, Section 2.

Outcome:- SWBAT Explain the purchasing power of money Identify and explain the different measures of inflation KECSSMS. MURREN ECONOMICS1/4/12.

Basics of Economics Key terms and ideas. Economics ❖ The science that deals with the production, distribution, and consumption of goods and services,

Copyright© 2008 South-Western, a part of Cengage Learning. All rights reserved. CHAPTER 4 Where’s the Beef? Inflation, Real GDP, and Business Cycles.

Economic Indicators. Gross Domestic Product GDP per Capita.

Chapter 13, Section 2 Price Indexes. Constructing a Price Index Used to measure changes in P. over time Created by selecting a base year and a representative.

Section 4.2 Understanding the Economy.  The goals of an economy  The various measurements used to analyze an economy  The four phases of the business.

Inflation as a way to measure performance of developed and developing countries.

Microeconomics and Macroeconomics FCS 3450 Spring 2015 Unit 2.

Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

The Measurement and Calculation of Inflation Market Baskets and Price Indices.

Economics Indicators INFLATION & THE CONSUMER PRICE INDEX (CPI)

Standard SSEMA1b- Define CPI SSEMA1c- Calculate economic measures.

Microeconomics Topic 1: The Economic Problem

U.S. Economic Performance

Signs of Economic Growth or Decline

U.S. Economic Performance

Inflation Basics Dr. D. Foster – ECO 285.

Chapter Eighteen McGraw-Hill/Irwin

SHORT TERM INDICATORS IN THE SERVICE SECTOR

Inflation Basics Dr. D. Foster – ECO 285.

Inflation Basics Dr. D. Foster – ECO 285.

Inflation Basics Dr. D. Foster – ECO 285.

Macroeconomics Economic Indicators.

INFLATION IN INDIA.

Chapter Eighteen McGraw-Hill/Irwin

Price Stability Average level of prices in the economy is neither increasing nor decreasing.

Presentation transcript:

A rise in the macro price level Measured by calculating the Inflation rate of a price index Inflation rates differ across countries Measured Quarterly/Monthly/Weekly

Consumer Price Index Cost of Living Index Producer Price Index Commodity Price Index Core Price Index GDP Deflator

Measure of the average price of consumer goods and services purchased by households Used by most of the developed countries to measure Inflation Calculated monthly and is one of the most closely watched national economic statistics

2 basic types of data are needed to construct the CPI: - Price Data - Weighting Data Calculated using a Laspeyres Index Laspeyres Index uses the base year quantities

PI t (L) = W i ( P it / P io ) where, W i = Q io P io / Q io P io PI t (L) = ( Q io P io / Q io P io ) ( P it / P io ) PI t (L) = Q io P it / Q io P io PI t (L) -> Laspeyres Price Index

Period Rice Shirt House PriceQuantity PriceQuantity PriceQuantity , , *10, * *50 Consumer Price Index = *10, * *50 = % = 149.7

Eg: CPI in > 150 CPI in > – 150 Inflation Rate = * 100 ( 2005 – 06) 150 = 6.67 %

As an economic Indicator As a deflator of other economic series As a means for Indexation To compare the Cost of Living in different cities To forecast future consumer expenditures To assess a nations progress towards economic stability

Switching over from WPI to CPI is risky and unwieldy Too much of a lag in reporting CPI numbers

CPI for Industrial Workers ( CPI-IW ) 145 for August 2008 ( Base : 2001 = 100 ) Source : Labour Bureau, Ministry of Labour, Government of India CPI for Urban Non Manual Employees ( CPI-UNME) 528 for March 2008 ( Base : = 100 ) Source : Central Statistical Organization, Government of India CPI for Agricultural/Rural Labourers ( CPI-AL ) 450 for August 2008 ( Base : =100) Source : Labour Bureau, Ministry of Labour, Government of India

CPI for All Urban Consumers ( CPI-U) ( Base : = 100 ) CPI for Urban Wage Earners and Clerical Workers ( CPI – W ) ( Base : = 100 ) Chained CPI for All Urban Consumers ( C-CPI-U ) ( Base : 1999 =100 ) September 2008 Source : Bureau of Labor Statistics, US Dept. of Labour