EC4004 2008 Lecture5 Markets and the Macroeconomy II
-
Upload
stephen-kinsella -
Category
Business
-
view
635 -
download
1
Transcript of EC4004 2008 Lecture5 Markets and the Macroeconomy II
![Page 1: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/1.jpg)
Markets and the Macroeconomy IIStephen Kinsellastephenkinsella.net
![Page 2: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/2.jpg)
Today
• Recap
• Equilibrium in the Markets
• Consumption, Saving, and Investment
![Page 3: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/3.jpg)
The Macroeconomy is the sum of Supply
and Demand in Individual Markets
![Page 4: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/4.jpg)
Household Behaviour
![Page 5: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/5.jpg)
Consumption
![Page 6: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/6.jpg)
Saving
![Page 7: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/7.jpg)
Firm Behaviour
![Page 8: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/8.jpg)
Equilibrium
![Page 9: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/9.jpg)
Demonstration
![Page 10: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/10.jpg)
The market clearing approach assumes that:
a. people are able to affect prices that influence their decisions.
b. firms are able to affect prices that influence their decisions.
c. prices adjust to clear markets.
d. all of the above.
Text to 086 399 83 06
![Page 11: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/11.jpg)
If the nominal wage rate is €10 per hour and the price level is 2, then the real wage a worker earns is:
a.five units of goods per hour.
c.twenty units of goods per hour.
b.eight units of goods per hour.
d. one-fifth unit of goods per hour.
Text to 086 399 83 06
![Page 12: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/12.jpg)
If the principal of a bond is €1000, it matures in a year and the interest rate is 6%, then at the end of the year the lender will receive:
a.€1000.
c.€60.
b.€1060.
d.€940.
Text to 086 399 83 06
![Page 13: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/13.jpg)
086 399 83 06
![Page 14: EC4004 2008 Lecture5 Markets and the Macroeconomy II](https://reader030.fdocuments.net/reader030/viewer/2022032700/55d734efbb61eb074f8b4571/html5/thumbnails/14.jpg)
Next Time: Read Barro, chapters 7, 8.