Lawyers/Journalists/Dentists/ Shop Assistants/Pilots Page 2 of 30 APPROACHES TO ECONOMIC QUESTIONS MICROECONOMICS (individual) consumers firms markets MACROECONOMICS (aggregate) economic growth employment unemployment inflation balance of payments exchange rates æ â å micro and macro inter-related CIRCULAR FLOW OF INCOME Page 3 of 30 CIRCULAR FLOW OF INCOME • households demand goods and services from producers (consumer expenditure) producers supply goods and services to households (production)
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Oster, Sharon M; Principles of ECONOMICS 10th Edition, Pearson/Prentice-Hall, 2012 ISBN-10: 0132552914; ISBN-13: 9780132552912 0132744856 OR Case, Karl E., Fair, Ray C., & Oster, Sharon M; Principles of Macroeconomics 10th Edition, Pearson/Prentice-Hall, 2012 ISBN-10: 0131391402; ISBN-13: 978-0131391406 AND MyEconLab (Required) (Note that all the required materials can be purchased from Hampton University Virtual Bookstore). CATALOG
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Fundamentals of Macroeconomics As one begins to understand how the economic world around him is affected by basic events, one must gain a basic knowledge of the basic design of the economy for maximum effectiveness. To facilitate this learning process, this paper will describe some basic terms that are in most discussions surrounding economics. Once there is an understanding of the terms, the description will change to several scenarios, and how the result of a seemingly innocuous event has a
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to prescribe what should be done. I understand what economics is and the basis of how and why economists try and predict the behavior of the consumers. How they observe, and come up with a hypothesis. I also understand the differences between macroeconomics and microeconomics. Lastly, what would be considered macro and what would be considered micro. Chapter 2 Key Points: 1. Human capital is the productive knowledge and skill people receive from education, on the job training, health and
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Understanding the Concept of Production Possibilities Frontiers 1.4.2 Understanding How a Change in Technology or Resources Affects the PPF 10.1 Aggregate Output and Income 10.1.1 The Production Possibilities Frontier: Macroeconomic Applications 10.1.2 The Circular Flow Model 10.1.3 Real GDP 10.2 Approaches to Calculating GDP 10.2.1 The Expenditures Approach 10.2.2 The Income Approach Competency: 309.1.4 Economic Variables and the Economy 11.1 The Business Cycle
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MacroEconomics Diagrams and Definitions What is macroeconomics? • Macroeconomics is the study of a national economy. Macroeconomic Goals Income Distribution Growth External Stability Employment Price Stability Two Sector Circular Flow of Income Monetary Flow Households Expenditure on Goods and Services (E) Real Flow Good and Services = Output (O) Factors of Production Wages, Rent and Profits (Y) E=O=Y Firms 4 Four Sector Circular Flow of Income
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basics of Keynes theories and how they were applied as well as points of success, but it is difficult to go much further than that. To summarize what I learned between our text and A Review of Keynesian Theory, Keynesian economics worked at the macroeconomic level. The theories stated that the trends at the macro-level could overpower individuals and their actions at the micro-level. It emphasized the significance of the aggregate demand for goods in driving the economy, especially economies in a slump
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Macroeconomic Indicators & objectives Deals with the performance of the economy as a whole. Four main indicators to measure this are: 1. Economic growth 2. Unemployment 3. Inflation 4. The current account of the balance of payments In relation to each indicator, they have objectives which are strong and sustainable growth, low employment, low and stable inflation and an acceptable balance
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INTRODUCTION * Economics is divided into two branches: Microeconomics and macroeconomics. 1. Microeconomics is the study of how individual Households and firms make decisions and how they interact with one Another in markets. 2. Macroeconomics is the study of the economy as a whole. The Goal of macroeconomics is to explain the economic changes that affect many Households, firms, and markets at once. * Macroeconomists address diverse questions: * Why is average income high
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inflation? Does GDP measure society’s well-being? 1 Micro vs. Macro Microeconomics: The study of how individual households and firms make decisions, interact with one another in markets. Macroeconomics: The study of the economy as a whole. We begin our study of macroeconomics with the country’s total income and expenditure. MEASURING A NATION’S INCOME 2 Income and Expenditure Gross Domestic Product (GDP) measures total income of everyone in the economy. GDP
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