Economic fluctuations by Jakub Staniszewski https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4 en-us 2021-06-09 08:11:29 UTC 2026-02-17 19:10:18 UTC hello@padlet.com https://padlet.net/icons/png/1f4ca.png Examples of adverse supply shocks https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600748800 1. A new environmental protection law that requires firms to reduce their emissions of pollutants. firm pass the on the added costs to customers in the form of higher prices
2. A drought that destroys crops. The reduction in food supply pushes up food prices.
3. An increase in union aggressiveness. This pushes up wages and the prices of the goods produced by union workers. ]]> 2021-06-11 10:09:38 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600748800 https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600751274 Examples of positive supply shocks are decreases in oil prices, lower union pressures, and a great crop season 

Favorable supply shocks result in:
 • Lower costs
 • Lower prices
 • Higher real output or real GDP
 • Lower unemployment


Favorable supply shocks shift the aggregate short run supply curve up
↑SRAS | ↑rGDP | ↓ UR | ↓ PL
↓SRAS | ↓rGDP | ↑ UR | ↑ PL



]]> 2021-06-11 10:12:23 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600751274 Examples of positive supply shocks: https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600751619 1. decreases in oil prices
2.lower union pressure
3. a great crop season]]> 2021-06-11 10:12:48 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600751619 https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600751626 Index of consumer expectations: 
This is a direct measure of expectations, 
based on a survey conducted by the University of Michigan’s Survey 
Research Center.
Increased optimism about future economic conditions 
among consumers suggests increased consumer demand for goods and 
services, which in turn will encourage businesses to expand production 
and employment to meet the demand.


]]> 2021-06-11 10:12:48 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600751626 Example of favourable demand shocks include: Interest rate cuts Tax cuts Stimulus checks https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600753574 2021-06-11 10:14:25 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600753574 Affect on output and prices in long and short run https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600756679 In the short run, the price level increases and output decreases, also known as stagflation, as the new short-run aggregate supply curve meets the aggregate demand curve at a new intersection that is to the upper left of the old intersection. But, as the economy adjusts, the aggregate demand curve shifts until the economy is again in long- run equilibrium at a lower price level with output unchanged.]]> 2021-06-11 10:17:32 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600756679 Index of stock Prices https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600757156 The stock market reflects expectations about future economic conditions because the stock market investors bid up prices when they expect companies to be profitable an increase in the stock prices indicates that investors expect the economy to grow rapidly, a decrease in stock prices indicates that investors expect an economy slow down]]> 2021-06-11 10:17:54 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600757156 The Lithium Shortage https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600757380 The rise of electric cars over the past few years is a real-world example of a demand shock. It was hard to predict the demand for electric cars and, therefore, for their component parts, for example, lithium battery.
From 2010, the rise in the demand for electric cars from companies like Tesla Motors increased the overall market share of these cars to 3 percent, or roughly 2,100,000 vehicles. The demand for lithium batteries to power the cars also increased sharply, and somewhat unexpectedly.
Lithium is a limited natural resource that is difficult to extract and found only in certain parts of the world. Production has been unable to keep up with the growth in demand, and so the supply of newly mined lithium remains lower than it would be otherwise. The result is a demand shock.
Over the period from 2004 to 2014, demand for lithium more than doubled. Then, demand exploded for not only electric vehicles but battery-powered mobile phones and tablets.
Since 2014, the price of lithium has more than doubled again. The cost has been passed onto the consumer, raising the cost of electric cars in a positive demand shock environment.]]> 2021-06-11 10:18:06 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600757380 Examples deuksueyoon https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600759553 1. Global pandemic
2. Central bank rate increases
3. Stock market crashes]]> 2021-06-11 10:20:20 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600759553 Affect deuksueyoon https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600760371
reaseon : when demand is shocked to decrease, we expect both the quantity supplied and consumed, as well as the price of the transactions to decrease.

the price of the transactions decresases because as consumers want to consume less, they are willing to pay less.

the quantity supplied and consumed decreases because, as the prices decrease, suppliers are willing to produce less.

To balance such a negative demand shock, governments may be inclined to lower interest rates, cut taxes, or increase spending to reverse a self reinforcing negative spiral.
]]> 2021-06-11 10:21:14 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600760371 Tax cuts in short run : Primarily through their impact on demand. Tax cuts boost demand by increasing disposable income and by encouraging businesses to hire and invest more. https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600761577 2021-06-11 10:22:40 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600761577 GDP https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600764264 Gross Domestic Product (GDP)

The gross domestic product is widely accepted as the primary indicator of macroeconomic performance. The GDP, as an absolute value, shows the overall size of an economy, while changes in the GDP, often measured as real growth in GDP, show the overall health of the economy.

The GDP consists of four components, namely:

  1. Consumption
  2. Investment
  3. Government Expenditure
  4. Net Exports
]]> 2021-06-11 10:25:30 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600764264 Introduction of new technologies https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600765452 Technological advances that improve production efficiency will shift a supply curve to the right. The cost of production goes down, and consumers will demand more of the product at lower prices. Computers, televisions and photographic equipment are good examples of the effects of technology on a supply curve.

]]> 2021-06-11 10:26:47 UTC https://padlet.com/jakubjstaniszewski/fpr3gg9e9mr40oh4/wish/1600765452