Monday, September 25, 2017

9:06 AM

Outline

Tomorrow - PS1 due

PS2 due Saturdayish

Midterm 1 on Oct 2 (make 3"x5" notecard, one sided)

Review on Fri. 

1. Fisher Equation
2. Production
   1. Prodn function
   2. Neoclassical Assumptions

1. Fisher Equation

-Inflation makes interest rates confusing

-loans.  i cost of borrowing, ben to lending

-inflation benefits borrowers @ expense of lenders

-borrowers take today's dollars from lenders (principal)

-repay with future dollars

-inflation erodes future purchasing power - repay with dollars worth less