ECONOMICS 1B

ECS1601
Semester 1
Department of Economics

Revision week 4
Learning units 9, 10 and 11

Contents
Page
Learning unit 9
Inflation .................................................................................................................................................

Learning unit 10
Unemployment....................................................................................................................................

Learning unit 11
Economic growth and business cycles ...............................................................................................

11

Inflation
LEARNING UNIT

OUTCOMES
[After you have worked through this learning unit, you should be able to]

define inflation

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define the consumer price index (CPI)

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use CPI data to calculate inflation rates

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define the production price index (PPI)

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discuss the differences between the CPI and PPI

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define the implicit GDP deflator

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compare the different measures of inflation

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explain why policy makers regard inflation as a problem

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explain the difference between demand-pull and cost-push inflation using diagrams

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explain the conflict approach to inflation

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CHECKLIST
Well
Concepts
I am able to
define inflation
describe the CPI, PPI and the implicit GDP deflator
differentiate between the CPI, PPI and the implicit GDP
deflator
define demand-pull inflation
define cost-push inflation
Explanations
I am able to
differentiate between nominal and real values
explain why policy makers regard inflation as a problem
distinguish between the main types of costs of inflation
describe what measures can be used to get rid of demandpull inflation
explain what measures can be used to get rid of cost-push
inflation
explain the conflict approach to inflation
Diagrams
I am able to
(i)
show on a diagram
(ii) explain with or without the aid of a diagram
the difference between demand-pull and cost-push inflation
the impact of measures taken to get rid of demand-pull and
cost-push inflation
Calculations
I am able to calculate
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the inflation rate

Satisfactory

Must
redo

Need
help

Well

Satisfactory

Must
redo

Need
help

distinguish between fiscal and monetary policy

discuss the four lags associated with fiscal and monetary
policy
Diagrams
I am able to
(i)
show on a diagram
(ii) explain with or without the aid of a diagram
the impact of key changes on the AD curve table 19-1
the impact of key changes on the AS curve table 19-2
Contractionary and expansionary fiscal/monetary policy
figure 19-4
changes in aggregate supply figures 19-5 and 19-6
the transmission mechanism figure 19-7
the policy dilemma in an open economy figure 19-10
NOTES
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Unemployment
LEARNING UNIT

OUTCOMES
[After you have worked through this learning unit, you should be able to]

define the rate of unemployment

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identify the costs of unemployment

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distinguish between the different types of unemployment

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suggest policies to tackle the unemployment problem
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illustrate and explain the Phillips curve

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CHECKLIST
Well
Concepts
I am able to
define the rate of unemployment
identify the costs of unemployment
Explanations
I am able to
distinguish between the different types of unemployment
suggest policies to tackle the unemployment problem
Diagrams

Satisfactory

Must
redo

Need
help

10
Well

Satisfactory

Must
redo

Need
help

Concepts
I am able to
define the rate of unemployment
identify the costs of unemployment
Explanations
I am able to
distinguish between the different types of unemployment
suggest policies to tackle the unemployment problem
Diagrams
NOTES
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11

Economic growth
and business
LEARNING UNIT
[After you have worked through this learning unit, you should be able to]

define economic growth

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explain how economic growth is measured

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define the business cycle

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identify sources of economic growth

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12
Well

Satisfactory

Must
redo

Need
help

Well

Satisfactory

Must
redo

Need
help

Concepts
I am able to
define economic growth
list the problems associated with the use of GDP
define the business cycle
name the elements of a business cycle
identify sources of economic growth from the supply side
identify sources of economic growth from the demand side
Explanations

I am able to
explain how economic growth is measured
explain the importance of using real GDP per capita when
measuring economic growth
Diagrams
I am able to
(i)
show on a diagram
(ii) explain with or without the aid of a diagram:
the business cycle see the figure in the study guide
NOTES
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