ECON 209 Lecture : Chapter 19 What Macroeconomics is All About.docx
11 Apr 2012
School
Department
Course
Professor
Document Summary
Most macroeconomic issues are about either long run trends (economic growth) or short run fluctuations (business cycles) and government policy is relevant for both. Two streams of research in macro: based explicitly on micro foundations, based only implicitly on these micro foundations. National product is most comprehensive measure of nation"s overall level of economic activity. If a firm produces worth of ice cream, that ultimately represents income for firm"s workers, the firm"s suppliers of material inputs, and the firm owners. National product is by definition equal to national income. To measure total output in dollars, we add up values of the many different goods produced. With base-period prices, we get real national income: read national income will be denoted by y. One of most commonly used measures of national income is called gross domestic product (gdp) Read gdp measures quantity of total output produced by nation"s economy over period of a year.
