Mod 14 Flashcards
1
Q
Real income
A
Income/PL
2
Q
Inflation rate
A
%change per year in PI
3
Q
Shoe-leather costs
A
(High inflation rates) Increased costs of transactions caused by inflation
4
Q
Menu costs
A
Real costs of changing listed prices
5
Q
Unit of account costs
A
Happens because of the way inflation makes money less reliable as a unit of measurement. (((((It’s replaced by new currency usually as a solution )))))
6
Q
Nominal interest rate
A
Interest actually paid
7
Q
Real interest rate
A
Nominal - rate of inflation
8
Q
Disinflation
A
Process of bringing inflation rate down
9
Q
Real wage
A
Wage rate/PL
