
This Lecture is based on Measurement techniques of Gross Domestic Product (GDP).
Definition and Components of GDP, Circular Flow Diagram, Other Measure of National Income
Case study for the understanding of GDP and its components.
Nominal Versus Real GDP, Numerical solution of These two concepts.
Ratio of Nominal GDP to Real GDP = GDP Deflator
Good market, Like how to change the decision of investment, saving and IS curve.
If the output level is fixed then we can clear the market with a change in the interest rate.
Solve this Excercise
Unemployment rate = natural rate of unemployment - a(Actual inflation - expected inflation)
Natural rate of unemployment = 5.5%
Expected inflation = 2.5%
Coefficient a in PC equation = 0.5
A. Plot the long-run Phillips curve.
B. Find the u-rate for each of these values of actual inflation: 0%, 5%. Sketch the short-run PC.
C. Suppose expected inflation rises to 5%.
Repeat part B.
D. Instead, suppose the natural rate falls to 4.5%. Draw the new long-run Phillips curve,
then repeat part B.
changes in labor demand and supply and the impact on wages and prices or changes in labor demand and supply by the change of prices and wages.
Impact of wages and prices on the aggregate supply curve.
Adaptive and Rational Expectation
Classical and Keynesian point of view regarding Expectations
GDP measuring techniques, Good, Money, Phillips Curve, and Labor Market. Other than these things I can develop topics on student demand. In these topics all things will cover in detail like all techniques of measuring the GDP, the full topic of Good Market (Investment and saving curves), Full knowledge of money market (LM), and aggregate demand.
You will learn about a Circular flow diagram that will show you how the market actually works. the market works in a circle such as a buyer working in the market and earning money and spending that money for the sake of purchasing. A company buys labor and pays wages and makes a profit.
You will learn about the Nominal vs real gdp, such as nominal GDP works with current prices and real GDP with base prices. on the other side, the components of the GDP are very important such as consumption, investment, and many other components.
Good Market: You will learn about the good market which deals with IS curve such as the relationship between investment and saving with interest rate.
Money Market: the money market is based on money demand and supply that makes the LM curve. the LM curve is showing the positive relationship between interest rate and productivity. the interest rate has a positive relationship with Money supply and a negative with money demand.