About This Chapter
Georgia Milestones: Inflation Measurement & Adjustment - Chapter Summary
To help you study for the Georgia Milestones Economics/ Business/ Free Enterprise EOC assessment, this chapter will help you review the different causes and effects of inflation, how inflation is measured and how wages are adjusted to changes in monetary value. Watch the videos of this chapter to follow along with our expert instructors as they explain:
- Measures of the consumer price index and how it's related to inflation
- Calculations for real wages and adjusting for inflation
- Difference between nominal GDP and real GDP
- How GDP is calculated
- Definition and causes of cost-push inflation
- The multiplier effect and how to calculate it
- Differences between demand-pull inflation and cost-push inflation
- How inflation can affect suppliers and demanders
After each lesson, use its lesson transcript to reinforce your understanding of the material presented in the lessons and study the key vocabulary of the chapter. If you have any questions about the lessons of this chapter, be sure to ask or instructors for assistance via the teacher tabs of the lessons. To test your understanding of the lesson, be sure to complete the lesson quizzes that follow them.
1. Consumer Price Index and the Substitution Bias
In this lesson, you'll learn about the Consumer Price Index and how it is measured. You'll also learn why many economists believe that the Consumer Price Index overstates inflation.
2. Adjusting Wages for the Inflation Rate
Have you ever heard your parents complain that a dollar doesn't go as far as it used to? In this practical lesson, learn how to calculate the real wage by adjusting the nominal wage to account for changes in the price level within the economy.
3. Gross Domestic Product: Nominal vs. Real GDP
Watch this video and you'll learn the difference between nominal GDP and real GDP with the help of a memorable story about a competition between twin brothers.
4. Gross Domestic Product: How to Calculate Real GDP
Learn how to adjust economic output for inflation using real GDP. This calculation enables economists to remove the effect of rising prices and more accurately compare economic output from multiple years.
5. How to Calculate Real GDP Growth Rates
How can you tell how much the economy is really growing from year to year? In this lesson, you'll discover the formulas economists use to calculate real GDP growth rates and draw conclusions about real economic growth.
6. Cost-Push Inflation: How the Supply Side of the Economy Leads to Inflation
Learn about cost-push inflation, when higher production prices lead to an increase in prices within the economy. Using real-world examples, this lesson describes what it is, what causes it and how economists illustrate it.
7. The Multiplier Effect and the Simple Spending Multiplier: Definition and Examples
When money is spent in an economy, this spending results in a multiplied effect on economic output. This lesson explains the multiplier effect and the how to use the simple spending multiplier to calculate it.
8. Demand-Pull Inflation vs Cost-Push Inflation
Discover two basic types of inflation, demand-pull and cost-push inflation. Learn what factors cause each type of inflation and some of the key differences between each.
9. Effects of Inflation on Suppliers and Demanders
In this lesson, you'll discover who benefits and who suffers from a sustained increase in prices within an economy. We'll cover the effects of expected and unexpected inflation on savers/creditors and borrowers/debtors.
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Other chapters within the Georgia Milestones - Economics/Business/Free Enterprise EOC: Test Prep & Practice course
- Georgia Milestones: Introduction to Economics
- Georgia Milestones: Scarcity, Choice & the Production Possibilities Curve
- Georgia Milestones: Consumer Behavior & Microeconomics
- Georgia Milestones: Supply & Demand
- Georgia Milestones: Economic Interdependency
- Georgia Milestones: Economic Price & Income Elasticity
- Georgia Milestones: Types of Economic Systems
- Georgia Milestones: Government's Role in Economic Systems
- Georgia Milestones: Market Structures in the US Economy
- Georgia Milestones: Business Organizations
- Georgia Milestones: Making Business Decisions
- Georgia Milestones: Understanding Production in Microeconomics
- Georgia Milestones: Comparative vs. Absolute Advantage
- Georgia Milestones: Macroeconomic Equilibrium
- Georgia Milestones: Scarce Economic Resource Markets
- Georgia Milestones: Measuring Economic Activity
- Georgia Milestones: Economic Growth & Productivity
- Georgia Milestones: Understanding Unemployment
- Georgia Milestones: Aggregate Supply & Demand
- Georgia Milestones: Fiscal & Monetary Policies
- Georgia Milestones: Expansionary & Contractionary Policies
- Georgia Milestones: Money, Banking & Financial Markets
- Georgia Milestones: Central Bank & the Money Supply
- Georgia Milestones: Foreign Exchange & the Balance of Payments
- Georgia Milestones: Trade Barriers & Regulations
- Georgia Milestones: Consumer Decision Making
- Georgia Milestones: Savings & Investments
- Georgia Milestones: Credit & Interest Rates
- Georgia Milestones: Insurance
- Georgia Milestones: Taxation
- Georgia Milestones - Economics/Business/Free Enterprise EOC Flashcards