Presentation is loading. Please wait.

Presentation is loading. Please wait.

Chapter 3 Your Purchasing Power. Slide 2 What Is Inflation? 3-1 Inflation and the Value of Money Inflation is an increase in prices for goods and services.

Published byKenneth Lester Modified over 8 years ago

Similar presentations

Presentation on theme: "Chapter 3 Your Purchasing Power. Slide 2 What Is Inflation? 3-1 Inflation and the Value of Money Inflation is an increase in prices for goods and services."— Presentation transcript:

1 Chapter 3 Your Purchasing Power

2 Slide 2 What Is Inflation? 3-1 Inflation and the Value of Money Inflation is an increase in prices for goods and services. Consumer Price Index (CPI) measures price changes over time. As inflation rises, the purchasing power of the dollar falls.

3 Slide 3 What Are the Types of Inflation? 3-1 Inflation and the Value of Money Disinflation occurs when the rate of rising prices slows down. Reflation occurs when high prices are followed by lower prices and then high prices again. Hyperinflation is rapidly rising prices that are out of control. Deflation is a decrease in prices.

4 Slide 4 What Are Causes and Effects of Inflation? 3-1 Inflation and the Value of Money Causes Demand-pull Cost-push Real-cost Effects Higher employment rates Less spending Less saving

5 Slide 5 Focus On... Fighting Inflation Monetary policy refers to the actions by the Fed to stabilize the economy. o Fed controls the discount rate, federal funds rate, and prime rate. Fiscal policy refers to the actions by the federal government to manage the economy. o Government raises/lowers taxes. 3-1 Inflation and the Value of Money

Download ppt "Chapter 3 Your Purchasing Power. Slide 2 What Is Inflation? 3-1 Inflation and the Value of Money Inflation is an increase in prices for goods and services."

Similar presentations

Copyright 2007 Thomson South-Western Chapter 3 Income and Purchasing Power.

Copyright 2007 Thomson South-Western Chapter 3 Income and Purchasing Power.
Chapter 8 Inflation These slides supplement the textbook, but should not replace reading the textbook.

Chapter 8 Inflation These slides supplement the textbook, but should not replace reading the textbook.
Chapter 16 Macroeconomic Policies © 2001 South-Western College Publishing.

Chapter 16 Macroeconomic Policies © 2001 South-Western College Publishing.
Intro to Business, 7e © 2009 South-Western, Cengage Learning SLIDE1 Economic Conditions Change Goals Describe the four phases of the business cycle. Explain.

Intro to Business, 7e © 2009 South-Western, Cengage Learning SLIDE1 Economic Conditions Change Goals Describe the four phases of the business cycle. Explain.
Unit 6 Macroeconomics: GDP and Economic Challenges Chapters 13.2 Economics Mr. Biggs.

Unit 6 Macroeconomics: GDP and Economic Challenges Chapters 13.2 Economics Mr. Biggs.
Inflation Macroeconomics. Inflation… what is it?  An increase in the economy’s price level  The price level is the weighted average of prices  A decrease.

Inflation Macroeconomics. Inflation… what is it?  An increase in the economy’s price level  The price level is the weighted average of prices  A decrease.
Chapter 28 Inflation: Causes and Consequences. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 28-2 Figure 28.1 Consumer Price Level in.

Chapter 28 Inflation: Causes and Consequences. Copyright © 2005 Pearson Addison-Wesley. All rights reserved Figure 28.1 Consumer Price Level in.
Chapter 12 Managing the Macroeconomy. Stagflation: it occurs when recession and inflation takes place simultaneously in the economy.

Chapter 12 Managing the Macroeconomy. Stagflation: it occurs when recession and inflation takes place simultaneously in the economy.
Fiscal and Monetary Policies The Government’s Role In the Economy.

Fiscal and Monetary Policies The Government’s Role In the Economy.
Copyright © 2004 South-Western. All rights reserved.4–1 Learning Goals Identify macroeconomic factors that affect business performance. Explain how market.

Copyright © 2004 South-Western. All rights reserved.4–1 Learning Goals Identify macroeconomic factors that affect business performance. Explain how market.
Macroeconomics Study Guide. How do we measure the health of our economy? First Economic Indicator: GDP Second Economic Indicator: Inflation Third Economic.

Macroeconomics Study Guide. How do we measure the health of our economy? First Economic Indicator: GDP Second Economic Indicator: Inflation Third Economic.
Aggregate Demand. Aggregate Demand Aggregate Demand slopes downward like other demand curves, but for different reasons.

Aggregate Demand. Aggregate Demand Aggregate Demand slopes downward like other demand curves, but for different reasons.
Inflation and the Value of Money. What habits drive consumer spending? How do evolving attitudes change spending habits?

Inflation and the Value of Money. What habits drive consumer spending? How do evolving attitudes change spending habits?
INFLATION.

INFLATION.
MEASURING PRICE CHANGES AND INTEREST RATES INTERESTED IN HOW THE AVERAGE OF PRICES IS CHANGING – NOT HOW INDIVIDUAL PRICES ARE CHANGING INFLATION – AVERAGE.

MEASURING PRICE CHANGES AND INTEREST RATES INTERESTED IN HOW THE AVERAGE OF PRICES IS CHANGING – NOT HOW INDIVIDUAL PRICES ARE CHANGING INFLATION – AVERAGE.
ECN 202: Principles of Macroeconomics Nusrat Jahan Lecture-11 Fiscal Policy & Monetary Policy.

ECN 202: Principles of Macroeconomics Nusrat Jahan Lecture-11 Fiscal Policy & Monetary Policy.
Federal Reserve Economic Systems Economic Terms Trade $100 $200 $300 $400 $500 $100 $200 $300 $400 $500 $100 $200 $300 $400 $500 $100 $200 $300 $400.

Federal Reserve Economic Systems Economic Terms Trade $100 $200 $300 $400 $500 $100 $200 $300 $400 $500 $100 $200 $300 $400 $500 $100 $200 $300 $400.
What do economists Look at when evaluating price changes over time?

What do economists Look at when evaluating price changes over time?
Causes of Inflation. What is inflation? A sustained rise in the level of prices OR a fall in the purchasing power of money How do you measure inflation?

Causes of Inflation. What is inflation? A sustained rise in the level of prices OR a fall in the purchasing power of money How do you measure inflation?
FISCAL AND MONETARY POLICY. ECONOMIC GOALS Full Employment Enough jobs to employ all able and willing to work Unemployment/Employment Data Bureau of Labor.

FISCAL AND MONETARY POLICY. ECONOMIC GOALS Full Employment Enough jobs to employ all able and willing to work Unemployment/Employment Data Bureau of Labor.

Similar presentations

Ads by Google