!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!Econ%104%%%1st%Edition%These 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.! ! !!!!!!!!!Lecture!2%Outline%of%Last%Lecture%%I. Introduction!to!Macroeconomics!(Chapter!5)!Outline%of%Current%Lecture%%II. Recessions!and!Inflations!III. Government!Deficits!a. The!Causes!IV. Definition!of!a!Deficit!V. National!Income!Accounting!VI. GDP!a. Real!GDP!and!Constant!Prices!b. Nominal!GDP!and!Current!Prices!!Current%Lecture!D Big!Problems!for!the!Economy!(&!Economists):!Recessions!and!Inflation!D Government!Deficits!(Causes):!!Wars!Recession!Tax!Cuts!D Deficit:!The!difference!between!government!expenditure!and!government!spending.!D The!last!time!America!paid!down!their!debt!was!in!1958,!ever!since!then,!they!continue!to!refinance!their!debt.!D National!Income!Accounting:!The!measure!of!economic!activity!in!the!country.!Occurred!and/or!began!in!the!1930’s!due!to!Simon!Kuznets!Price!!!!x!!!!Quantity!!!=!Gross!Domestic!Product!P!!!!!!!!!!x!!!!!!!!!Q! ! !!!!!!!!!=!GDP!D Real!GDP!and!Constant!Prices:!An!inflationDadjusted!measure!that!reflects!the!value!of!all!goods!and!services!produced!in!a!given!year,!expressed!in!baseDyear!prices.!These 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.! ! !D
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