Econ 2020, Topic 1

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Notes for Topic 1 of Econ 2020, Spring 2013

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Econ 2020, Topic 1

  1. 1. Introduction toMacroeconomics Spring 2013 Topic 1
  2. 2. Course BasicsSyllabus Schedule is tentative Grading policy
  3. 3. Course BasicsSyllabusReadings Book Wall Street Journal
  4. 4. Course BasicsSyllabusReadingsSapling Learning
  5. 5. Course BasicsSyllabusReadingsSapling LearningBlackboard
  6. 6. What is economics?Scarcity Limited resources, unlimited wants
  7. 7. What is economics?ScarcityEconomics is the study of the choices madedue to scarcity
  8. 8. What is macroeconomics?Microeconomics Individual choices Individual markets
  9. 9. What is macroeconomics?MicroeconomicsMacroeconomics How individual choices combine to determine the macroeconomic BIG THREE
  10. 10. What are the big three? Inflation Nov. 2012 1.8%
  11. 11. What are the big three? Inflation Unemployment Dec. 2012 7.8%
  12. 12. What are the big three? Inflation Unemployment Output and growth 3rd quarter, 2012 estimate $15.811 trillion 3.1%
  13. 13. How economists workThe scientific method Observational versus experimental
  14. 14. How economists workThe scientific methodEconomic models The role of assumptions
  15. 15. How economists workThe scientific methodEconomic modelsPositive vs. normative economics
  16. 16. A first model: PPFProduction Possibilities Frontier Models what the economy is capable of producing
  17. 17. A first model: PPFProduction Possibilities FrontierFactors of production Physical capital Labor Natural resources Technological knowledge
  18. 18. A second model: the Circular FlowModels the interconnections in the economyModels how much of the productive potentialthe economy will use

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