An explanation of financial systems meant to match borrowers with savers, including stocks, bonds, and financial intermediaries.
An explanation of the market for loanable funds in a closed economy, including the relationship between real interest rates, the supply of loanable funds from our national savings, and the demand for loanable funds for private investment.
An explanation of the process of marginal analysis that a firm goes through to decide the correct amount of physical capital to maximize profits.
An explanation of the market for loanable funds in an open economy with net exports and net capital outflows.
An explanation of how countries interact with each other to make up the world market for loanable funds, assuming an autarky interest rate model in a two-country world, both with large open economies.
An explanation of money, including the three main roles of money: medium of exchange, unit of account, store of value.
An explanation of the mission of the Federal Reserve and an explanation of fractional reserve banking.
An explanation of the money market and three ways the Federal Reserve conducts monetary policy.
An explanation of Federal Reserve policy regarding the labor market, including the relationship to the Phillip’s Curve and Sticky Wage Theory.
An explanation of nominal and real exchange rates, including our market for dollars exchanged into foreign currency, and how monetary policy affects exchange rates.
An explanation of the Purchasing Power Parity theory and how nominal exchange rates change in response to prices.
An explanation of aggregate supply and aggregate demand, including three reasons aggregate demand is downward sloping.
An explanation of aggregate supply, including the Sticky Price Theory and Sticky Wage Theory, and how an economy recovers from a recession through the Sticky Wage Theory.
An explanation of different viewpoints on the role of government in the economy, both in the short run and the long run.
An explanation of short run government spending with a crowding out effect and long run government spending meant to increase standards of living.
An explanation of corporate tax cuts, a discussion of personal income tax cuts, and a brief description of structural policy.
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