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• Table of Contents

Table of Contents

Note: Each chapter includes a Conclusion, Key Points, Key Terms, Questions for Review, and Problems. Each appendix includes Key Points, Key Terms and Definitions, Questions for Review, and Problems.
I. Introduction to Economics
1. The Central Idea
Scarcity and Choice for Individuals
Scarcity and Choice for the Economy as a Whole
Market Economies and the Price System
Economics in Action: Gains from Trade on the Internet
Economics in Action: Teaching Jobs and Graduate School Applications--Two Sides of the Same Coin
Economics in the News: Gains from Trade on the Radio
2. Observing and Explaining the Economy
What Do Economists Do?
The Fluctuating Price of Gasoline
Recommending Appropriate Policies
Economics in Action: An Economic Experiment to Study Discrimination
Economics in Action: Science or Persuasion?
Economics in the News: Young Economists at Work
Appendix to Chapter 2. Reading, Understanding, and Creating Graphs
Visualizing Observations with Graphs
Visualizing Models with Graphs
3. The Supply and Demand Model
Demand
Supply
Market Equilibrium: Combining Supply and Demand
Economics in the News: Why Roses Cost More on Valentine's Day
Economics in Action: Using the Supply and Demand Model to Analyze Real-World Issues
4. Subtleties of the Supply and Demand Model: Price Floors, Price Ceilings, and Elasticity
Interference with Market Prices
Elasticity of Demand
Working with Demand Elasticities
Elasticity of Supply
Economics in Action: How Policymakers Use Price Elasticity of Demand to Discourage Underage Drinking
Economics in the News: Increasing School Enrollment in Africa
Economics in Action: Predicting the Size of a Price Increase
Economics in Action: Will an Increase in the Minimum Wage Benefit Poor Workers?
II. Principles of Macroeconomics
5. Macroeconomics:The Big Picture
Measuring the "Size" of an Economy
Unemployment, Inflation, and Interest Rates
Macroeconomic Theory and Policy
Economics in the News: How Economic Growth Can Transform an Economy
Economics in Action: The Economic Impact of September 11
Appendix to Chapter 5. The Miracle of Compound Growth
How Compound Growth Works
Plotting Growing Variables
6. Measuring the Production, Income, and Spending of Nations
Measuring GDP
Saving
Measuring Real GDP
Shortcomings of the GDP Measure
Economics in Action: Distinguishing Between Stocks and Flows
Economics in the News: The Monthly Release of GDP Data
Economics in Action: Measuring the Quality of Life Across Nations
7. The Spending Allocation Model
The Spending Shares
The Effect of Interest Rates on Spending Shares
Determining the Equilibrium Interest Rate
The Relationship Between Saving and Investment
Economics in Action: Using the Spending Allocation Model to Analyze the Long-Run Implications of Shifts in Government Purchases and Consumption
Economics in the News: The "Twin Deficits"
8. Unemployment and Employment
Unemployment and Other Labor Market Indicators
The Nature of Unemployment
Modeling the Labor Market
Economics in the News: Unemployment Each Month
Economics in Action: Unemployment Among Young People Around the World
9. Productivity and Economic Growth
Labor and Capital Without Technology
Technology: The Engine of Growth
Measuring Technology
Technology Policy
Economics in Action: The Role of Technology in Economic Growth
Economics in Action: Examples of Changes in Technology That Increased Productivity
Economics in Action: Two Invention Factories: Past and Present
Economics in Action: Growth Accounting in Practice
Economics in the News: Productivity Growth
Appendix to Chapter 9. Deriving the Growth Accounting Formula
10. Money and Inflation
What Is Money?
The Fed, the Banks, and the Link from Reserves to Deposits
Money Growth and Inflation
Economics in the News: Counterfeit Money
Economics in Action: Hyperinflation and Too Much Money
III. Economic Fluctuations and Macroeconomic Policy
11. The Nature and Causes of Economic Fluctuations
Changes in Aggregate Demand Lead to Changes in Production
Forecasting Real GDP
The Response of Consumption to Income
Finding Real GDP When Consumption and Income Move Together
Spending Balance and Departures of Real GDP from Potential GDP
Economics in Action: Real-Life Examples of How Firms Respond to Demand
Economics in the News: Assessing the Macroeconomic Impact of a Terrorist Attack
Economics in Action: The Professional Forecasters
Economics in Action: Making Time's Top 100
Appendix to Chapter 11. Deriving the Formula for the Keynesian Multiplier and the Forward-Looking Consumption Model
The Keynesian Multiplier
The Forward-Looking Consumption Model
12. The Economic Fluctuations Model
The Aggregate Demand Curve
The Inflation Adjustment Line
Combining the Aggregate Demand Curve and the Inflation Adjustment Line
Economics in the News: The Fed Raises and Then Lowers the Interest Rate
13. Using the Economic Fluctuations Model
Changes in Government Purchases
Changes in Monetary Policy
Price Shocks
Economics in Action: Explaining the Recovery from the Great Depression
Economics in Action: The 2001 Recession and Recovery
14. Fiscal Policy
The Government Budget
Countercyclical Fiscal Policy
The Structural Versus the Cyclical Surplus
Economics in Action: How Should Social Security Be Reformed?
Economics in Action: The Economic Report of the President
15. Monetary Policy
Why Are Central Banks Independent?
Running Monetary Policy
Money and Other Instruments of Monetary Policy
The Exchange Rate and Monetary Policy
Economics in the News: Anatomy of a Hump
16. Financial Markets
The Distinction Between Physical Capital and Financial Capital
Markets for Financial Capital
The Tradeoff Between Risk and Return
Corporate Governance Problems
Economics in Action: Understanding Stock and Bond Price Listings in Newspapers
Economics in the News: Corporate Greed
Appendix to Chapter 16. Present Discounted Value
Discounting the Future
Finding the Present Discounted Value
IV. Trade and Global Markets
17. Economic Growth and Globalization
Catching Up or Not?
Economic Development
Spreading and Using Technology
Increasing Capital per Worker
Economics in Action: The Millennium Challenge Corporation
Economics in Action: Is There a Global Saving Glut?
18. The Gains from International Trade
Recent Trends in International Trade
Comparative Advantage
Reasons for Comparative Advantage
Gains from Expanded Markets
Economics in the News: The Economic Impact of Outsourcing
Economics in Action: Doing Politics and Economics
19. International Trade Policy
Tariffs and Quotas
The History of Trade Restrictions
Arguments for Trade Barriers
How to Reduce Trade Barriers
Economics in Action: From Steel to Shrimp: The Same Old Tariff Story
Economics in the News: The End of the Multi-Fiber Agreement
Economics in Action: Ending the Corn Laws
Glossary
Index
Credits