Macro-economics 2A
Main learning objectives:
Thinking in terms of abstract models when discussing questions about the
international economy:
- Describe and explain the interactions between goods, money,
Lecture 1
What is macroeconomics
-
The big picture
What happens to the entire economies?
Income, growth, unemployment. Inflation
Relationship between these variables
- Globalization
o Goods, and services
Output and Time
The most important goal of macroeconomics is to develop an understanding of
what makes income differ between countries and what makes them grow or
fluctuate over time (Gartner, p. 36)
- Analyzing equilibrium
- Comparing equilibrium
- How do countries move between equilibrium?
- Different time frames
o Different processes
o Different variables
o Different policies
Short and long run
Long run output is fixed
Short run price is fixed
Income= Expenditure when a economy is in an equilibrium
 unplanned investment
Lm curve gives the comnination of interest rate and income when the economy
is in equilibrium