CPI: Consumer Price Index

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CPI: Consumer Price Index

Lecture for 1/16


Lecture number:
2
Pages:
2
Type:
Lecture Note
School:
University of Colorado at Boulder
Course:
Econ 3535 - Natural Resource Economics

Unformatted text preview:

Lecture 2 Current Lecture CPI: Consumer Price Index  below 1% o measure of inflation o low due to weak economic growth  GDP growth = 5%/year  <2% = good (no concerns about inflation)  Higher interest rates = lower investment o Government raises interest rates in order to prevent inflation in the long-term Russia: o -2.9% GDP growth in 2015  severe recession o decreasing export revenues (sanctions)  falling oil prices  cuts in all of budget except for military  ruble depreciation  raising price of imports  capital flight  conversion of money into dollars and euros o raising interest rates o 17% interest rates by the Central Bank  starting to use reserves to mitigate effects  sanctions will expire this spring Resource Paradox: o Produced capital + natural capital + intangible capital = predictor of wealth  Human capital increases 7% with every year of education  K = capital  Country Intangible Produced Natural Total Wealth per Capita Luxembourg 73.2% 26.1% 0.7% $818, 081 U.S. 84.6% 13.5% 1.9% $741, 142 Congo 27.4% 8.1% 64.6% $2,477 ECON 3535 1st Edition



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