AB/204 AB204 AB 204 UNIT 5 DISCUSSION 2

AB 204 UNIT 5 DISCUSSION 2

Unit 5: Unemployment and the Cost of Living - Discussion

General Information:

To be an effective learning tool the Discussion Board topics require your active discussion of the topic with at least two of your classmates.

• First post made during, or before, Saturday.
• Posts on at least 3 different days.
• Responses to at least two other classmates.
• Substantive posts that stimulate further active discussion, posts that accurately reflects the learning, that are logical, and clearly presented with correct spelling, word usage, and grammar.
• To be counted as a substantial post, your main post to the Discussion topics should be at least 200 words per Discussion topic.

Effects of Unemployment and Inflation

The Discussion topics focus on how to measure the cost of living and rate of unemployment in the economy, and specific discussion areas include the various forms of unemployment and how they are measured, debates on measuring unemployment rate, and the imperfections of official unemployment rate. Moreover, consumer price index (CPI), rate of inflation, and their impacts on the cost of living will be discussed.

Respond to two of the following Discussion topics. Read Chapters 11 and 15, and remember to include references and links to the websites that are important contributors to your posts (comments).

Topic 2

The consumer price index (CPI) is used to calculate the rate of inflation, and hence it measures the cost of living in an economy.

1. How do we use consumer price index (CPI) to measure the cost of living? What is the relationship between CPI and the rate of inflation?
2. What is the importance of measuring price fluctuations? How does the change in average price help explain the difference between nominal and real interest rates?