Reading Notes
Chapter Six Macroeconomics Intro
Macroeconomics examines
↳ The actions
level of
the overall
behavior of the
economy
of all firms and individuals interact to
produce
a particular
economy-wide
performance
economic
Paradox Thrift: When families are worried about the possibility of economic hand times prepare
,
by cutting their spending and businesses react by laying off workers
"
They may end up
↳ This
ends
worse off
than if they hadn't tried to act and
up harming everyone , on the flip side
they will stimulate
the
corrected
According
Keynesian
Monetary Policy Changes
Fiscal
of
have
different from
Families
and
in
the
what
Spend more today
any one individual intended
problems such as
"invisible hand" (no use for
economics :
:
level
may
Economist's before 1930 believed that
:
through the work of an
to
when businesses
off spending
.
economy leading to positive effects
The combined decisions of individuals
self-regulating
cut
unemployment would be
govty (wrong
A depressed economy is a result of inadequate
quantity of money to alter interests
rates ,
which
spending
affect the
spending
Policy Changes in taxes and gov't spending to affect overall spending
overall
:
The Business Cycle
Index of industrial production: A measure of the total output of the
manufacturing sector
In each downturn
on the number
people employed
Canadian sectors
cut back on
production
and
of