Upon successful completion of this course, you will be able to:

  • identify the determinants of demand and supply;
  • describe how changes in demand and supply lead to changes in a market’s equilibrium price and quantity;
  • distinguish microeconomics from macroeconomics;
  • describe the circular flow model, identifying linkages between the markets for goods and resources as well as the exchanges between businesses and households;
  • define nominal gross domestic product and real gross domestic product;
  • compare and contrast as well as discuss various measures of output and income;
  • distinguish between real and nominal values;
  • analyze the problems associated with using GDP as a measure of well-being;
  • identify the components of the expenditure and the income approaches to the measurement of GDP;
  • explain how consumer income relates to spending and saving;
  • describe the consumption and savings functions and the terms attached to their slopes;
  • define automatic stabilizers, and explain changes in government spending and taxing during a macroeconomic recession and expansion;
  • describe how savings and investment contribute to economic growth;
  • define economic growth in terms of changes in the production possibilities curve and in real gross domestic product;
  • define unemployment rate;
  • calculate the unemployment rate;
  • identify and distinguish between the different forms of unemployment;
  • analyze the problems associated with the unemployment rate;
  • describe the three types of unemployment and factors that relate to them;
  • define inflation and deflation, and explain how each affects the price and economic growth of an economy;
  • define, interpret, and calculate inflation rate and the consumer price index;
  • describe the problems and biases associated with the consumer price index;
  • articulate sources of inflation, and explain how they can affect economic stability;
  • use the model of aggregate demand and aggregate supply to explain stagflation;
  • explain the relationship between inflation and unemployment;
  • describe and analyze the Classical as well as the Keynesian views on unemployment; and
  • discuss various explanations for wage and price stickiness.