Macroeconomics

Macroeconomics studies Aggregate Pheonomena of: GDP / Employment / Investment / Inflation & Money / LR growth / Investment, Govn’t Expenditure, Exports.

• Began formally from the 20th century after the Great Depression; before that it ways just microeconomics. (Keynes & Hayaek)
• Static vs Dynamic
  • Static: comparing at the same point in time
  • Dynamic: comparing at different points in time
  • e.g. Comparative statics, like an exogenous increase in demand causing $Q_S$ to increase
• Economic Time in macro covers usually the following timeframes:
  1. Short Run (SR): several years
  2. Medium Run (MR): 1~2 years
  3. Long Run (LR): Decades
• Real vs Nominal Variables.
  • Real: real things as units (cars, hours, gallons), or base-year currency
  • Nominal: values in currency at a certain year

Unemployment

Inflation

Circular Flow of Income

Taxation