ECON 1051 1nd Edition Lecture 41 Outline of Last Lecture I. Unemployment a. Example numbersb. Types of Unemployment II. Measuring Inflation a. Definitionsb. GDP Deflator c. Consumer Price Index Outline of Current Lecture I. Inflation Using Real Life Examplesa. Highest grossing moviesb. Figuring out which grossed more with regards to inflation c. Whose salary is higher, Obama’s or Truman’s?Current LectureI. Inflation Using Real Life Examples a. Highest Grossing Movies:i. Gone With the Wind grossed 390 million in 1940 ii. Avatar grossed 2,700 million in 2009b. Figuring out which grossed more with regards to inflation:i. Bring 1940 dollars into 2009’s dollar: 1. 390 mil x 215/14 2. =390 mil x 15.3 3. =5989 mil a. Gone With the Wind would have grossed 5989 million dollars if it had been made in 2009 ii. Bring 2009 dollars into 1940’s dollar: 1. 2700 mil x 14/215 2. =175 million dollars a. Avatar would have only grossed 175 million if it came out in 1940c. Whose salary is higher Obama or Truman?i. Salaries: 1. Obama – $425,000These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.2. Truman – $100,000ii. CPI1. CPI now = 2332. CPI 1945 = 18iii. Equivalent of Obama’s pay in 1945 dollars: 1. = 425,000 x 18/233 2. = $32,833iv. Equivalent of Truman’s pay in 2014 dollars:1. = 100,000 x 233/18 2. =
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