Preface
Chapter 1 Welcome to Economics!
Introduction
1.1 What Is Economics, and Why Is It Important?
1.2 Microeconomics and Macroeconomics
1.3 How Economists Use Theories and Models to Understand Economic Issues
1.4 How To Organize Economies: An Overview of Economic Systems
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Chapter 2 Choice in a World of Scarcity
Introduction to Choice in a World of Scarcity
2.1 How Individuals Make Choices Based on Their Budget Constraint
2.2 The Production Possibilities Frontier and Social Choices
2.3 Confronting Objections to the Economic Approach
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 3 Demand and Supply
Introduction to Demand and Supply
3.1 Demand, Supply, and Equilibrium in Markets for Goods and Services
3.2 Shifts in Demand and Supply for Goods and Services
3.3 Changes in Equilibrium Price and Quantity: The Four-Step Process
3.4 Price Ceilings and Price Floors
3.5 Demand, Supply, and Efficiency
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 4 Labor and Financial Markets
Introduction to Labor and Financial Markets
4.1 Demand and Supply at Work in Labor Markets
4.2 Demand and Supply in Financial Markets
4.3 The Market System as an Efficient Mechanism for Information
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 5 Elasticity
Introduction to Elasticity
5.1 Price Elasticity of Demand and Price Elasticity of Supply
5.2 Polar Cases of Elasticity and Constant Elasticity
5.3 Elasticity and Pricing
5.4 Elasticity in Areas Other Than Price
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 6 The Macroeconomic Perspective
Introduction to the Macroeconomic Perspective
6.1 Measuring the Size of the Economy: Gross Domestic Product
6.2 Adjusting Nominal Values to Real Values
6.3 Tracking Real GDP over Time
6.4 Comparing GDP among Countries
6.5 How Well GDP Measures the Well-Being of Society
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 7 Economic Growth
Introduction to Economic Growth
7.1 The Relatively Recent Arrival of Economic Growth
7.2 Labor Productivity and Economic Growth
7.3 Components of Economic Growth
7.4 Economic Convergence
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 8 Unemployment
Introduction to Unemployment
8.1 How Economists Define and Compute Unemployment Rate
8.2 Patterns of Unemployment
8.3 What Causes Changes in Unemployment over the Short Run
8.4 What Causes Changes in Unemployment over the Long Run
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 9 Inflation
Introduction to Inflation
9.1 Tracking Inflation
9.2 How to Measure Changes in the Cost of Living
9.3 How the U.S. and Other Countries Experience Inflation
9.4 The Confusion Over Inflation
9.5 Indexing and Its Limitations
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 10 The International Trade and Capital Flows
Introduction to the International Trade and Capital Flows
10.1 Measuring Trade Balances
10.2 Trade Balances in Historical and International Context
10.3 Trade Balances and Flows of Financial Capital
10.4 The National Saving and Investment Identity
10.5 The Pros and Cons of Trade Deficits and Surpluses
10.6 The Difference between Level of Trade and the Trade Balance
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 11 The Aggregate Demand/Aggregate Supply Model
Introduction to the Aggregate Supply–Aggregate Demand Model
11.1 Macroeconomic Perspectives on Demand and Supply
11.2 Building a Model of Aggregate Demand and Aggregate Supply
11.3 Shifts in Aggregate Supply
11.4 Shifts in Aggregate Demand
11.5 How the AD/AS Model Incorporates Growth, Unemployment, and Inflation
11.6 Keynes’ Law and Say’s Law in the AD/AS Model
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 12 The Keynesian Perspective
Introduction to the Keynesian Perspective
12.1 Aggregate Demand in Keynesian Analysis
12.2 The Building Blocks of Keynesian Analysis
12.3 The Phillips Curve
12.4 The Keynesian Perspective on Market Forces
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Chapter 13 The Neoclassical Perspective
Introduction to the Neoclassical Perspective
13.1 The Building Blocks of Neoclassical Analysis
13.2 The Policy Implications of the Neoclassical Perspective
13.3 Balancing Keynesian and Neoclassical Models
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 14 Money and Banking
Introduction to Money and Banking
14.1 Defining Money by Its Functions
14.2 Measuring Money: Currency, M1, and M2
14.3 The Role of Banks
14.4 How Banks Create Money
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 15 Monetary Policy and Bank Regulation
Introduction to Monetary Policy and Bank Regulation
15.1 The Federal Reserve Banking System and Central Banks
15.2 Bank Regulation
15.3 How a Central Bank Executes Monetary Policy
15.4 Monetary Policy and Economic Outcomes
15.5 Pitfalls for Monetary Policy
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 16 Exchange Rates and International Capital Flows
Introduction to Exchange Rates and International Capital Flows
16.1 How the Foreign Exchange Market Works
16.2 Demand and Supply Shifts in Foreign Exchange Markets
16.3 Macroeconomic Effects of Exchange Rates
16.4 Exchange Rate Policies
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 17 Government Budgets and Fiscal Policy
Introduction to Government Budgets and Fiscal Policy
17.1 Government Spending
17.2 Taxation
17.3 Federal Deficits and the National Debt
17.4 Using Fiscal Policy to Fight Recession, Unemployment, and Inflation
17.5 Automatic Stabilizers
17.6 Practical Problems with Discretionary Fiscal Policy
17.7 The Question of a Balanced Budget
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 18 The Impacts of Government Borrowing
Introduction to the Impacts of Government Borrowing
18.1 How Government Borrowing Affects Investment and the Trade Balance
18.2 Fiscal Policy and the Trade Balance
18.3 How Government Borrowing Affects Private Saving
18.4 Fiscal Policy, Investment, and Economic Growth
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 19 Macroeconomic Policy Around the World
Introduction to Macroeconomic Policy around the World
19.1 The Diversity of Countries and Economies across the World
19.2 Improving Countries’ Standards of Living
19.3 Causes of Unemployment around the World
19.4 Causes of Inflation in Various Countries and Regions
19.5 Balance of Trade Concerns
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 20 International Trade
Introduction to International Trade
20.1 Absolute and Comparative Advantage
20.2 What Happens When a Country Has an Absolute Advantage in All Goods
20.3 Intra-industry Trade between Similar Economies
20.4 The Benefits of Reducing Barriers to International Trade
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Chapter 21 Globalization and Protectionism
Introduction to Globalization and Protectionism
21.1 Protectionism: An Indirect Subsidy from Consumers to Producers
21.2 International Trade and Its Effects on Jobs, Wages, and Working Conditions
21.3 Arguments in Support of Restricting Imports
21.4 How Governments Enact Trade Policy: Globally, Regionally, and Nationally
21.5 The Tradeoffs of Trade Policy
Key Terms
Key Concepts and Summary
Self-Check Questions
Review Questions
Critical Thinking Questions
Problems
Appendix A The Use of Mathematics in Principles of Economics
Appendix B The Expenditure-Output Model
Answer Key
Chapter 1
Chapter 2
Chapter 3
Chapter 4
Chapter 5
Chapter 6
Chapter 7
Chapter 8
Chapter 9
Chapter 10
Chapter 11
Chapter 12
Chapter 13
Chapter 14
Chapter 15
Chapter 16
Chapter 17
Chapter 18
Chapter 19
Chapter 20
Chapter 21
References
Index