Shaikh, Anwar (2010) The First Great Depression of the 21st Century

Question 1

``the rate of profit-of-enterprise (r - i)’’ – Marx

Answer 1

the difference between the profit rate (r) and the interest rate (i) (Shaikh, 2010, p. 46)

Question 2

``the marginal efficiency of capital (MEC)’’ – Keynes

Answer 2

``the rate of profit-of-enterprise (r - i)’’ – Marx (Shaikh, 2010, p. 46)

Question 3

Years where the economy experienced a ``General economic crisis’’ according to Shaikh (2010, p. 44)

Answer 3

1820s, 1870s, 1930s, 1970s, and 2008

Question 4

The two types of business cycles in capitalism according to Shaikh (2010, p. 44)

Answer 4

``A fast (3-5 year inventory) cycle arises from the perpetual oscillations of aggregate supply and demand, and a medium (7-10 year fixed capital) cycle from the slower fluctuations of aggregate capacity and supply’’ (ibid.)

Question 5

Inflation

Answer 5

``inflation is a sustained increase in the general price level of goods and services in an economy over a period of time.[1] When the general price level rises, each unit of currency buys fewer goods and services.’’ (https://en.wikipedia.org/wiki/Inflation)

Question 6

deflation

Answer 6

``deflation is a decrease in the general price level of goods and services.[1] Deflation occurs when the inflation rate falls below 0% (a negative inflation rate).’’ (https://en.wikipedia.org/wiki/Deflation)

Question 7

Stagflation

Answer 7

“In economics, stagflation […] is a situation in which the inflation rate is high, the economic growth rate slows, and unemployment remains steadily high. It raises a dilemma for economic policy, since actions designed to lower inflation may exacerbate unemployment, and vice versa.” (https://en.wikipedia.org/wiki/Stagflation)