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Who am I?




A little bit about myself; my username is Empiricx, I have a B.A in Economics with a minor in Political Science. I graduated in 2019 and I am currently a non degree student at the University of Massachusetts Boston in order to further my education in mathematics. My goal is to keep my skills in Economics and Statistics sharp by reviewing concepts and problems.



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Macroeconomics: real vs nominal gross domestic product

Nominal GDP:   A nominal GDP measures the value of a nation's output produced in a year, given the prices charged for that year. However, if prices increase while the output level stays constant in a given year, the nominal GDP will drastically increase, even though the level of production is equal to that of the previous year. Estimating real GDP: To determine the actual change in output from one year to the next, we must adjust the nominal value of a country's output in a year based on changes in the average price level during that year.  Inflation is when the price level increases, whereas deflation is when the price level is decreasing. To determine whether the nominal GDP overestimates or underestimates the output of a country, one must know whether the average price level has increased or decreased. In order to achieve this task can use a price index known as the GDP deflator. The GDP deflator: Real GDP is calculated by replacing the prices for that current year with tho...
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Microeconomics: Firms and cost in the short run

In Economics, the term short run refers to a time period where at least one variable of interest does not change . In our case, the short run for a firm is when at least one input  (labor, land, capital) stays fixed. Usually land and capital are considered fixed in the short run.  If an input is fixed during a period time, no matter how much the total product a firm produces, its cost stays the same. This cost is commonly known as fixed cost (FC). Examples of fixed costs: rent, property taxes, loan payments. Labor is often considered to be a part of the  variable cost (VC) . Variable cost can be defined as the cost a firm has control over during the short run. Unlike fixed cost, variable cost increases (decreases) as a firm's total product increases (decreases). Examples of variable costs include: utility bills, wages, raw materials A firm's total cost (TC) is the sum of its variable and fixed costs. As you can see, the fixed cost...
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Macroeconomics: aggregate supply in the short run

Aggregate supply -short run analysis- : The aggregate supply is the total amount of goods and services the firms in a country produce at each price level in a fixed period of time. Sticky-wage and price model: In the short run, wages and other costs of production are relatively fixed. In other words, workers will not accept to receive a lower wage, when firms want to reduce their costs. Thus, firms must reduce output and layoff workers when aggregate demand drops. However, firms can also benefit from these fixed costs, if the aggregate demand increases (i.e shifts to the right). Prices increases but the costs stay the same, firms earn a bigger profit in the short run. Short run aggregate supply curve (SRAS): The SRAS curve is upward sloping, but is relatively flat below the full-employment level of output because of the "stickiness" of wages. The SRAS curve is relatively steep beyond the full employment level of output, since the firms are  physically constraint to ...
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