CHAPTERR 1-A TOUR OF THE WORLD 1
1-1 WHAT IS MACROECONOMICS? 1
PART ONE-INTRODUCTION 1
The Simplifications of Macroeconomics 3
1· Why Macroeconomists Sometimes Disagree 3
1-2 LOOKING AT THE WORLD 4
The United States 4
The European Union 8
Japan 11
GATHERJNG MACRO DATA 15
1-3 LOOKING AHEAD 16
CHAPTER 2-A TOUR OF THE BOOK 19
2-1 AGGREGATE OUTPUT 19
GDR,Value Added, and Income 20
Nominal and Real GDP 22
REAL GDR TECHNOLOGICAL PROGRESS, AND THE PRICE OF CONPUTERS 25
The Unemployment Rate 26
2-2 THE OTHER MAJOR MACROECONOMIC VARIABLES 26
DOES SPAIN REALLY HAVE A 23% UNEMPLOYMENT RATE 28
The Infiation Rate 29
Budget Deficits and Trade Deficits 34
2-3 A ROAD MAP 34
PART TWO-THE BASICS 40
CHAPTER3-THE GOODS MARKET 40
3-1 THE COMPOSlTlON OF GDP 40
3-2 THE DETERMINATION OF DEMAND 43
Consumption (C) 44
Investment (I) 45
Government Spending (G) 46
3-3 THE DETERMATION OFEQUILIBRIUM OUTPUT 46
The Algebra 47·A Graph 48·In Words 50
CONSUHER CONFIDENCE AND THE 1990-1991 RECESSION 51
3-4 INESTMENT EQUALS SAVING: AN ALTERNATIVE WAY OF THINKING ABOUT GOODS-MARKET EQUILIBRIUM 52
3-5 THE PARADOX OF SAVING 54
3-6 IS THE GOVERNMENT REALLY OMNIPOTENT? A WARNING 55
CHAPTER 4-THE GOODS MARKET DYNAMICS 58
4-1 PRODUCTION,SALES,AND IWENTORY INVESTMENT 58
Dividing Time 59
Production and Sales 59
Equilibrium in the Goods Market Revisited 60
The Dynamic Effects of an Increase in Government Spending 61
Using a Graph 63
4-2 GOING EMPIRICAL 65
Estimating the Marginal Propensity to Consume 65
Allowing for Lags 68
A GUIDE TO UNDERSTANDING ECONOMETRIC RESULTS 69
Correlation Versus Causality 69
4-3 SIMUWING THE ESTIMATEDMODEL 72
5-1 MONEY VERSUS BONDS 77
4-4 CONCLUSIONSCHAPTER 5-FINANCIAL MARKETS 77
SEHANT1C TRAPS:MONEY,INCOME,AND WEALTH 78
The Basic Choice 79
The Demand forMoney 80
The Demand for Bonds 81
. Money Demand and the Interest Rate： The Evidence 82
5-2 THE DETERMINATION OF THE INTEREST RATE:Ⅰ 84
Money Demand, Money Supply, and the Equilibrium Interest Rate 85
MonetaryPolicy and Open Market Operations 87
5-3 THE DETERMINATION OF THEINTEREST RATE:Ⅱ 090The Role of Banks 90
Monetary Policy and the Interest Rate 90
BANK RUNS 92
The Effects of an Open Market Operation 95