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Principles of Macroeconomics
University of British Columbia
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ECON 102 Lecture Notes - Lecture 1: Economy 7, Business Cycle, Price Level

Econ 102 lecture 1 what macroeconomics is all about. Introduction: bottom up model, microeconomic foundation, analyze the choices of each optimizing ag

ECON 102 Lecture Notes - Lecture 2: Northern Ireland Environment Agency, Intermediate Good, Income Approach

Econ 102 lecture 2 the measurement of national income: basic national income accounting, gdp from value added approach i. ii. iii. The goal of macroeco

ECON 102 Lecture Notes - Lecture 3: Ceteris Paribus, Macroeconomic Model, Consumption Function

Econ 102 lecture 3 national income and expenditure part i (c and i: desired v. actual expenditure a. P - general price level i - interest rates e - exc

ECON 102 Lecture 4: ECON 102 Lecture 4 National Income and Expenditures Part II (G and NX)

Econ 102 lecture 4 national income and expenditures part ii (g and nx: government, government purchases i. ii. iii. iv. v. Fiscal policy = use of gt to

ECON 102 Lecture Notes - Lecture 5: Fiscal Policy, Autarky, Potential Output

Econ 102 lecture 5 national income part ii con"t: equilibrium national income, ae function i. ii. Definition: ar = e = c + i + g + nx. 2: g = g, nx = f

ECON 102 Lecture Notes - Lecture 6: Ceteris Paribus, Fallacy, Aggregate Demand

Econ 102 lecture 6 output and prices in the short run: demand side of economy, shifts in the ae curve i. ii. Increase demand increase output, without i

ECON 102 Lecture Notes - Lecture 7: Ceteris Paribus, Aggregate Supply

Econ 102 lecture 7 output and prices in the short run con"t: supply side of economy, as curve i. Technology constant: we assume sras for this chapter i

ECON 102 Lecture Notes - Lecture 8: Potential Output, Classical Economics, Uric Acid

Econ 102 lecture 8 from short run to long run: three macroeconomic time spans a. P of inputs vary: the adjustment process, potential output and the out

ECON 102 Lecture 9: Econ 102 Lecture 9 From Short Run to Long Run con’t

ECON 102 Lecture Notes - Lecture 10: Output Gap, Business Cycle

Econ 102 lecture 10 from short run to long run con"t: contractionary ad shocks. Assume productivity constant, thus as w decreases, ac decreases. 1: #1

ECON 102 Lecture Notes - Lecture 11: Output Gap, Business Cycle

E. g. an increase in productivity: sr models are basically stabilization models - eliminate gaps by changing actual y (gapbusters) E. g. an increase in

ECON 102 Lecture Notes - Lecture 12: Malthusian Trap, Thomas Robert Malthus, Baby Boomers

Econ 102 lecture 12 long run economic growth: the nature of economic growth. Real gdp per person = standard of living 2% Real gdp per worker = labour p

ECON 102 Lecture 13: ECON 102 Lecture 13 Long Run Economic Growth Con’t

Econ 102 lecture 13 long run economic growth con"t: established theories of economic growth. Y adjusts around ye (wage adjustment model). (y = ye) Y as

ECON 102 Lecture 14: ECON 102 Lecture 14 Long Run Economic Growth Con’t

ECON 102 Lecture 15: ECON 102 Lecture 15 Long Run Economic Growth Con’t (1)

ECON 102 Lecture Notes - Lecture 16: Commodity Money, Money Supply, Divisor

Econ 102 lecture 16 money and banking: nature of money, classical and modern views of money i. Classical view of money: quantity theory of money: class

ECON 102 Lecture Notes - Lecture 17: Stephen Poloz, Mario Draghi, Janet Yellen

ECON 102 Lecture Notes - Lecture 18: Canada Deposit Insurance Corporation, Overnight Rate, Reserve Requirement

Econ 102 lecture 18 money and banking con"t: reserves i. ii. Purpose: held by banks to meet demands on deposits. Run on the banks = more depositors ish

ECON 102 Lecture 19: Econ 102 Lecture 19 Money and Banking con’t (1)

ECON 102 Lecture Notes - Lecture 20: Demand Deposit, Time Deposit, Debit Card

Econ 102 lecture 20 money and banking con"t: money supply. Money supply = currency (cash) + ?bank? deposits: kinds of deposits i. Demand deposit: withd

ECON 102 Lecture Notes - Lecture 24: 5, Value Engineering, Flowchart

Step ii m affects i-rate (flowchart: understanding bonds. Pv ~ 1/i-rate; pb = pv; thus pb ~ 1/i: reasons: i. ii. *this analysis is used to explain the

ECON 102 Lecture Notes - Lecture 25: Inverse Relation, Real Income, Lead

Lp = willingness to hold money for precautionary purposes. Reason: uncertainty about the timing of receipts and payments. *note: because lt and lp are

ECON 102 Lecture Notes - Lecture 26: Lead, Money Supply

Total demand for money function liquidity preference function. At high i-rates: ls =0, because all cash balances in bonds. The only demand for cash bal

ECON 102 Lecture 27: Econ 102 Lecture 27 Monetary Theory Con’t

ECON 102 Lecture Notes - Lecture 28: Exchange Rate

Ad curve decrease bank rate increase m increase m decrease i decrease ev increase ae increase ad yup. Same as above for investment transmission mechani

ECON 102 Lecture Notes - Lecture 29: John Maynard Keynes, Monetarism

ECON 102 Lecture Notes - Lecture 30: Federal Funds Rate, Overnight Rate, Interest Rate

Econ 102 lecture 30 monetary policy in canada: how boc implements monetary policy. Step i - overnight rate affects m (flowchart) Decrease onr decrease

ECON 102 Lecture Notes - Lecture 31: Federal Funds Rate, Canadian Imperial Bank Of Commerce, Basis Point

Econ 102 lecture 31 monetary policy in canada con"t i. Omo = open market operations (accommodate l: = g purchase /sale of securities in open market. Om

ECON 102 Lecture Notes - Lecture 32: Overnight Rate, Bell System, Canadian Imperial Bank Of Commerce

ECON 102 Lecture Notes - Lecture 33: Payments Canada, Cheque Clearing, Landing Vehicle Tracked

Econ 102 lecture 33 monetary policy in canada con"t: monetary policy - gapbusting . Poof - gap disappears: additional insights (optional) Thus, charter

ECON 102 Lecture Notes - Lecture 34: Monetarism, Money Multiplier, Deflation

Econ 102 lecture 34 monetary policy in canada con"t: the exchange rate i. ii. iii. iv. v. Change in e can affect inflation and the gap. Boc response wi

ECON 102 Lecture Notes - Lecture 35: 1973 Oil Crisis, National Bureau Of Economic Research, Monetarism

Econ 102 lecture 35 inflation: adding inflation to the model, what is inflation? i. Recession = 2 quarters of negative economic growth. Distort the p s

ECON 102 Lecture Notes - Lecture 36: G2 Phase, Money Supply, Stagflation

Econ 102 lecture 36 inflation con"t: from wages to prices i. Increase in nominal wages leads to an increase in prices: where miu = markup, thus, p = (1

ECON 102 Lecture Notes - Lecture 37: Shortage, Stagflation, 1973 Oil Crisis

1: supply inflation = inflation caused by sras shifting up but not caused by excess demand for inputs in domestic market, examples of causes of inflati

ECON 102 Lecture 38: Econ 102 Lecture 38 Inflation Con’t

ECON 102 Lecture Notes - Lecture 39: Phillips Curve, Inverse Relation, Disinflation

Econ 102 lecture 39 inflation con"t: phillips curve and accelerating inflation. In 1960"s, the level of wage and price inflation began to rise for any

ECON 102 Lecture Notes - Lecture 40: Nominal Interest Rate, Lawrence Summers, Real Wages

Distorts the allocation of resources: price signal distortion hypothesis = inflation interferes with the information conveyed by p changes, market part