LEARNING OBJECTIVE: a. Define (using the circular flow diagram as appropriate) how GDP is measured and its components. b. Calculate nominal GDP.
TOPIC 2.2 Limitations of GDP
LEARNING OBJECTIVE: Define the limitations of GDP.
TOPIC 2.3 Unemployment
LEARNING OBJECTIVE: a. Define labor force, the unemployment rate, and the labor force participation rate. b. Explain how changes in employment and the labor market affect the unemployment rate and the labor force participation rate. c. Calculate the unemployment rate and the labor force participation rate. d. Define the types of unemployment and the natural rate of unemployment. e. Explain changes in the types of unemployment.
TOPIC 2.4 Price Indices and Inflation
LEARNING OBJECTIVE: a. Define the consumer price index (CPI), inflation, deflation, disinflation, the inflation rate, and real variables. b. Explain how price indices can be used to calculate the inflation rate and to compare nominal variables over time periods. c. Calculate the CPI, the inflation rate, and changes in real variables.
TOPIC 2.5 Costs of Inflation
LEARNING OBJECTIVE: Explain the costs that unexpected inflation (deflation) imposes on individuals and the economy.
TOPIC 2.6 Real v. Nominal GDP
LEARNING OBJECTIVE: a. Define nominal GDP and real GDP. b. Calculate real GDP and the GDP deflator.
TOPIC 2.7 Business Cycles
LEARNING OBJECTIVE: a. Define (using graphs and data as appropriate) turning points and phases of the business cycle. b. Explain (using graphs and data as appropriate) turning points and phases of the business cycle.
