Welcome to Macroeconomics!

My objective is to provide you the tools and reasoning abilities you’ll need to understand what is going on in our world. Almost every aspect of life – whom you marry, what job you take, how many children to have – can be viewed from an economic perspective. Having a firm grasp of the fundamentals will let you make informed decisions that will benefit you throughout your life. We’ll spend time discussing economic policy options facing our society today and we’ll try to blend these policy options with knowledge of economic institutions so that our analyses will be as realistic as possible, given the environment in which we live.

Our goals are to take a close look at the decision-making processes of individuals, firms and governments in our economy and the impact on the other economies of the world. We will begin with general discussions of:

What is Economics? Economics is concerned with the way resources are allocated among alternative uses to satisfy human wants. Two basic facts exist - resources are scarce which forces you and I to make choices between using these various resources.
What are the four economic resource catagories? Economic resources are limited and scarce and mean 'all natural, human and manufactured resources that go into the production of goods and services'.
What is a Market? A market is an institution or mechanism that brings together buyers and sellers of a particular goods, services or resources.
What information does market Demand and Supply provide? Supply and demand bring together the buying decisions of households and the selling decisions of businesses to determine the price of a product and the quantity actually bought and sold.
We will then widen our focus to take in product and resource markets, the competitive market system, also known as the private enterprise system, or simply Capitalism.
We now move from the general characteristics of the market system to specific information about our economy. For convenience, we divide the economy into three sectors: the private sector - consumers and businesses, the government sector and the foreign sector.
How do we measure domestic output? The primary measure of the economy's performance is its total output of goods and services or aggregate output and is labeled Gross Domestic Product (GDP).
How do we measure the changes in Prices? A Price index measures the changes that occur in prices from one period to the next.
What causes the economic instability experienced by capitalistic economies? We will explore the theory of Business Cycles, the problems of unemployment and inflation.
What are the four economic goals of our society? The four economic goals are: Economic Growth, Full Employment, Stable Prices and a Balance of Trade. We will develop the Aggregate Expenditures (AE) model and the Multiplier to explain the economy and how these goals are achieved.
How do we explain price changes with the Aggregate Expenditures model? You can't. The AD-AS model will be developed to model our economy with price changes.
What is Fiscal Policy and how is it implemented? Fiscal Policy consist of deliberate changes in government spending and tax collections to achieve full employment, control inflation and encourage economic growth.
What is Money and can Banks create Money? Money can be defined several ways and 'Yes' banks can create money.
What is Monetary Policy and how its implemented? Monetary Policy are actions taken by the Federal Reserve System through the 'Open Market Committee' by changing the Money Supply to achieve our economic goals. These actions occur in the 'Money Markets', changes in reserve requirements and the discount rate, and other tools are available to the Federal Reserve.


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Welcome to Macroeconomics!

Our goals are to take a close look at the decision-making processes of individuals, firms and governments in our economy and the impact on the other economies of the world. We will begin with general discussions of:

What is Economics? Economics is concerned with the way resources are allocated among alternative uses to satisfy human wants. Two basic facts exist - resources are scarce which forces you and I to make choices between using these various resources.

What are the four economic resource catagories? Economic resources are limited and scarce and mean 'all natural, human and manufactured resources that go into the production of goods and services'.

What is a Market? A market is an institution or mechanism that brings together buyers and sellers of a particular goods, services or resources.

What information does market Demand and Supply provide? Supply and demand bring together the buying decisions of households and the selling decisions of businesses to determine the price of a product and the quantity actually bought and sold.

We will then widen our focus to take in product and resource markets, the competitive market system, also known as the private enterprise system, or simply Capitalism.

We now move from the general characteristics of the market system to specific information about our economy. For convenience, we divide the economy into three sectors: the private sector - consumers and businesses, the government sector and the foreign sector.

How do we measure domestic output? The primary measure of the economy's performance is its total output of goods and services or aggregate output and is labeled Gross Domestic Product (GDP).

How do we measure the changes in Prices? A Price index measures the changes that occur in prices from one period to the next.

What causes the economic instability experienced by capitalistic economies? We will explore the theory of Business Cycles, the problems of unemployment and inflation.

What are the four economic goals of our society? The four economic goals are: Economic Growth, Full Employment, Stable Prices and a Balance of Trade. We will develop the Aggregate Expenditures (AE) model and the Multiplier to explain the economy and how these goals are achieved.

How do we explain price changes with the Aggregate Expenditures model? You can't. The AD-AS model will be developed to model our economy with price changes.

What is Fiscal Policy and how is it implemented? Fiscal Policy consist of deliberate changes in government spending and tax collections to achieve full employment, control inflation and encourage economic growth.

What is Money and can Banks create Money? Money can be defined several ways and 'Yes' banks can create money.