Unemployment and Inflation. EVERYONE’S NIGHTMARE Chapter 6. Unemployment and Inflation. The two key concepts of Macroeconomics Either can destabilize the economy. When BOTH happen together – REALLY, REALLY BAD. STAGFLATION. Unemployment. People who are looking for work but have no jobs.
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Not included in your book – but in most other Econ texts
Average Hourly Earnings are up $ .01 in September.
The INFLATION Indicators
Automatic increases in wages or other payments that are tied to a price index.
For Future Reference on contract negotiations: Called COLA.
I THINK you need and deserve more info on inflation!
THE ANSWER???? inflation
What is the CPI pattern in 2009? inflation
Types of Inflation inflation
Demand-Pull Inflation inflation
Cost-Push Inflation inflation
Cost-Push v. Demand Pull inflation
Monetary Inflation inflation
Rule for Monetary Inflation: inflationVELOCITY
M x V = T x P inflation
What happens when the quantity equation is inflation“off”?
Unemployment goes UP, then inflation goes DOWN.