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AP Macroeconomics 1.1 Measurement of Economic Performance
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AP Macroeconomics 1.1 Measurement of Economic Performance. How do we measure net Domestic Product?

AP Macroeconomics 1.2 Measurement of Economic Performance
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AP Macroeconomics 1.2 Measurement of Economic Performance. What is inflation?

AP Macroeconomics 1.6 Measurement of Economic Performance
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AP Macroeconomics 1.6 Measurement of Economic Performance. Which is true of the basic two sector economy in the circular flow of income model?

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AP Macroeconomics 1.2 Measurement of Economic Performance 20 Views


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AP Macroeconomics 1.2 Measurement of Economic Performance. What is inflation?

Language:
English Language

Transcript

00:00

Thank you We sneak and here's your shmoop du jour

00:05

brought to you by inflation which is the reason that

00:08

cost of balloons keep going up not to mention the

00:10

balloons themselves Alright What's inflation and hear potential answers All

00:15

right This is inflation and this is inflation And this

00:22

is inflation Well not sure what it is Okay specifically

00:26

it is a rate at which the prices on goods

00:29

and services increase Usually yes but on an annualized basis

00:34

Well this holiday season when your grandmama's ask her what

00:37

she paid for her house This one the one she

00:40

bought fifty two years ago The one with the bathroom

00:42

door knob that it always falls off Yet she bought

00:45

it for eight grand about what you pay now for

00:47

a six year old prius The house would sell today

00:50

for three hundred grand Why That part of town suddenly

00:54

get more valuable No not at all It's the same

00:58

It increased in value at the same rate as inflation

01:02

So it's real value is about the same as it

01:04

was back Lynn fifty two years ago An average worker

01:08

made a thousand bucks a year Today that same average

01:11

Worker makes thirty seven point five grand a year And

01:14

guess what The home back then sold for eight times

01:17

the average worker's salary And well guess what Today it

01:21

sells for eight times the average worker's salary Right back

01:24

to the answer Inflation is an increase in prices not

01:28

just a change So is out See really foreign currency

01:33

How about asking if it refers to the sound loose

01:35

skywalker's lightsaber makes when he turns on the power random

01:39

All right d increased purchasing power No the opposite If

01:43

you have lots of inflation a dollar goes less far

01:46

than it used to Remember that wheelbarrow full of german

01:49

marks right there their currency back then before the euro

01:52

it used to take one of those paper bills to

01:54

buy a loaf of bread and inflation struck and well

01:58

you know start eating stagflation No it's Not about breeding

02:02

kentucky derby winners Stagflation refers to a specific element of

02:07

inflation where prices go up But employment does not And

02:11

yeah it's a bad thing unlike the breeding scenario Okay

02:16

so that's it The answer is b increase in prices

02:19

we dread the day that balloons will eventually cost twenty 00:02:21.603 --> [endTime] Bucks Each that's really gonna burst our bubble

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