ECON 2HH3 Chapter Notes - Chapter Chapters 1-3: Gross Domestic Product, Nominal Rigidity, Graph Rewriting
21 Jan 2017
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Document Summary
Addresses large questions that affect many people and nations of the world. Macroeconomics: study of the behavior of large collections of economic agents. Macroeconomics focuses on: aggregate behavior of consumers and firms, behavior of governments, overall level of economic activity in individual countries, economic interactions among nations, effects of fiscal and monetary policy. Macroeconomic models focus on long-run growth and business cycles: long-run growth: increase in gdp over time, business cycles: short-run ups and downs. Gross domestic product, economic growth, and business cycles. Gdp: quantity of goods/services produced within a country"s borders during specified period of time. Two observations about real gdp per capita in canada from 1870-2010: substantial growth, growth was not steady (fluctuations) Fluctuations in economic growth are business cycles. Useful graph transformation: separate series into two components, growth/trend component log of real per capita gdp (approx. growth rate, business cycle component deviations of real per capital gdp from smooth trend line.
