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Macroeconomics for Life Smart Choices for All Canadian 2nd Edition Cohen Solutions Manual.

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Product Details:

  • ISBN-10 ‏ : ‎ 0133135845
  • ISBN-13 ‏ : ‎ 978-0133135848
  • Author:  Avi J. Cohen

Micro/Macro Economics for Life 2e addresses the growing market needs and trends toward a literacy targeted approach to teaching economics, supported by an active-learning pedagogy and premium online teaching and learning resources.

Macroeconomics for Life offers a new narrative-driven approach to learning and teaching economics that demonstrates the relevance of economics to students. Accessible language and graphs, engaging first-person writing, a less-mathematical approach, and practical examples connect economics to students’ lives in a meaningful way. This text helps students become economically literate citizens, unlike traditional texts which prepare them to become economics majors.

 

Table of Content:

  1. 1 What’s in Economics for You? Scarcity, Opportunity Cost, Trade, and Models
  2. 1 What’s in Economics for You?
  3. Are You Getting Enough? Scarcity and Choice
  4. Refresh 1.1
  5. Give It Up for Opportunity Cost! Opportunity Cost
  6. Opportunity Cost Beats Money Cost
  7. Economics Out There: Where Have All the Men Gone?
  8. Incentives Work
  9. Refresh 1.2
  10. Why Don’t You Cook Breakfast? Gains from Trade
  11. Voluntary Trade
  12. Bake or Chop?
  13. Production Possibilities Frontier
  14. Deal or No Deal? Do the Numbers
  15. Comparative Advantage
  16. Smart Deals
  17. Achieving the Impossible
  18. Refresh 1.3
  19. Economists as Mapmakers and Scientists: Thinking Like an Economist
  20. Why Maps (and Economists) Are Useful
  21. The Circular Flow of Economic Life
  22. Economic Models
  23. Follow the Flow Clockwise
  24. Models as the Economist’s Laboratory
  25. All Other Things Unchanged
  26. Economics Out There: Do You Want to Be an Online Gamer Economist?
  27. Positive and Normative Statements
  28. Refresh 1.4
  29. Where and How to Look: Models for Microeconomics and Macroeconomics
  30. It’s All Greek to Me: Microeconomics or Macroeconomics?
  31. Macroeconomics
  32. Looking at the Trees or the Forest?
  33. Three Keys to Smart Choices: Weigh Marginal Benefits and Marginal Costs
  34. Key 1: Opportunity Costs Rule
  35. Key 2: Look Forward Only to Additional Benefits and Opportunity Costs
  36. Key 3: Implicit Costs and Externalities Count, Too
  37. Negative Externalities
  38. Positive Externalities
  39. Moving On
  40. Refresh 1.5
  41. Study Guide: Chapter 1 Summary
  42. 1.2 Give It Up for Opportunity Cost! Opportunity Cost
  43. 1.3 Why Don’t You Cook Breakfast? Gains from Trade
  44. 1.4 Economists as Mapmakers and Scientists: Thinking Like an Economist
  45. 1.5 Where and How to Look: Models for Microeconomics and Macroeconomics
  46. True/False
  47. Multiple Choice
  48. 2 Making Smart Choices The Law of Demand
  49. 2 Making Smart Choices The Law of Demand
  50. Put Your Money Where Your Mouth Is: Weighing Benefits, Costs, and Substitutes
  51. How Badly Do You Want It?
  52. What Will You Give Up?
  53. Refresh 2.1
  54. Living on the Edge: Smart Choices Are Marginal Choices
  55. Marginal Benefits Decrease with Quantity
  56. Economics Out There: Coke’s Automatic Price Gouging
  57. The Diamond/Water Paradox
  58. Refresh 2.2
  59. Move On When the Price Isn’t Right: The Law of Demand
  60. Quantity Demanded
  61. Changing Prices Change Quantity Demanded
  62. Water or Brooms?
  63. The Law of Demand
  64. Market Demand Curve for Water
  65. Economizing Decisions
  66. Two Ways to Read a Demand Curve
  67. Demand Curve
  68. Marginal Benefit Curve
  69. The Demand Curve Is Also a Marginal Benefit Curve
  70. Refresh 2.3
  71. Moving the Margins: What Can Change Demand?
  72. Why Bother Distinguishing between Quantity Demanded and Demand?
  73. Controlled Experiments
  74. Five Ways to Change Demand and Shift the Demand Curve
  75. Preferences
  76. Prices of Related Products
  77. Economics Out There: Diamond Engagement Rings Were Not Forever
  78. Income
  79. Economics Out There: If I Had $1 000 000 Dollars
  80. Expected Future Prices
  81. Number of Consumers
  82. Moving Along or Shifting the Demand Curve
  83. Saving the Law of Demand
  84. Refresh 2.4
  85. Study Guide: Chapter 2 Summary
  86. 2.2 Living on the Edge: Smart Choices Are Marginal Choices
  87. 2.3 Move On When the Price Isn’t Right: The Law of Demand
  88. 2.4 Moving the Margins: What Can Change Demand?
  89. True/False
  90. Multiple Choice
  91. 3 Show Me the Money The Law of Supply
  92. 3 Show Me the Money The Law of Supply
  93. What Does It Really Cost? Costs Are Opportunity Costs
  94. Marginal Cost
  95. How Demand and Supply Choices Are Similar
  96. How Demand and Supply Choices Are Different
  97. What Do Inputs Really Cost?
  98. Marginal Costs Are Ultimately Opportunity Costs
  99. Refresh 3.1
  100. Forget It, It’s History: Sunk Costs Don’t Matter for Future Choices
  101. Refresh 3.2
  102. More for More Money: The Law of Supply
  103. Quantity Supplied
  104. Body Piercings or Nail Sets?
  105. Paola’s Parlour’s Production Possibilities Frontier
  106. Increasing Marginal Opportunity Costs
  107. Opportunity Costs Are Marginal Costs
  108. Paying for Opportunity Costs
  109. Why Marginal Opportunity Costs Increase
  110. When Marginal Opportunity Costs Are Constant
  111. The Law of Supply
  112. Supply Curve of Piercings
  113. Two Ways to Read a Supply Curve
  114. Supply Curve
  115. Marginal Cost Curve
  116. The Supply Curve Is Also a Marginal Cost Curve
  117. Refresh 3.3
  118. Changing the Bottom Line: What Can Change Supply?
  119. Economics Out There: Uncorking the Okanagan
  120. Six Ways to Change Supply and Shift the Supply Curve
  121. Technology
  122. Economics Out There: Army of Noodle-Shaving Robots Invades Restaurants
  123. Environment
  124. Price of Inputs
  125. Prices of Related Products and Services
  126. Expected Future Prices
  127. Number of Businesses
  128. Moving Along or Shifting the Supply Curve
  129. Saving the Law of Supply
  130. Refresh 3.4
  131. Study Guide: Chapter 3 Summary
  132. 3.2 Forget It, It’s History: Sunk Costs Don’t Matter for Future Choices
  133. 3.3 More for More Money: The Law of Supply
  134. 3.4 Changing the Bottom Line: What Can Change Supply?
  135. True/False
  136. Multiple Choice
  137. 4 Coordinating Smart Choices Demand and Supply
  138. 4 Coordinating Smart Choices Demand and Supply
  139. What’s a Market?
  140. Markets Mix Competition and Cooperation
  141. The Rules of the Game
  142. Can I Trust You?
  143. Refresh 4.1
  144. Where Do Prices Come From? Price Signals from Combining Demand and Supply
  145. Economics Out There: Rules of the Game Are Necessary for All Games, Not Just Markets
  146. Prices in Action
  147. Demand Meets Supply
  148. Frustrated Buyers
  149. Frustrated Sellers
  150. Adjusting Prices and Quantities
  151. Self-Interest at Work
  152. Refresh 4.2
  153. When Prices Sit Still: Market-Clearing or Equilibrium Prices
  154. Market-Clearing Price
  155. Equilibrium Price
  156. The Invisible Hand
  157. Refresh 4.3
  158. Moving Targets: What Happens When Demand and Supply Change?
  159. Changes in Demand
  160. Decrease in Demand
  161. Changes in Supply
  162. Decrease in Supply
  163. Economics Out There: Lobsters Galore!
  164. Combining Changes in Demand and Supply
  165. Increase in Both Demand and Supply
  166. Decrease in Both Demand and Supply
  167. Increase in Demand and Decrease in Supply
  168. Decrease in Demand and Increase in Supply
  169. Putting It All Together
  170. Economists Do It with Models
  171. Start in Equilibrium
  172. One Change at a Time
  173. Refresh 4.4
  174. Getting More Than You Bargained For: Consumer Surplus, Producer Surplus, and Efficiency
  175. Consumer Surplus
  176. Producer Surplus
  177. Economic Efficiency
  178. Marginal Benefit Greater Than Marginal Cost
  179. Marginal Cost Greater Than Marginal Benefit
  180. Comparing Total Surplus
  181. Efficient Market Outcome
  182. Too Good to Be True?
  183. Refresh 4.5
  184. Study Guide: Chapter 4 Summary
  185. 4.2 Where Do Prices Come From? Price Signals from Combining Demand and Supply
  186. 4.3 When Prices Sit Still: Market-Clearing or Equilibrium Prices
  187. 4.4 Moving Targets: What Happens When Demand and Supply Change?
  188. 4.5 Getting More Than You Bargained For: Consumer Surplus, Producer Surplus, and Efficiency
  189. True/False
  190. Multiple Choice
  191. 5 Are Your Smart Choices Smart for All? Macroeconomics and Microeconomics
  192. 5 Are Your Smart Choices Smart for All? Macroeconomics and Microeconomics
  193. Is the Whole Greater Than the Sum of the Parts? Reconciling Macroeconomics and Microeconomics
  194. The Global Financial Crisis and the Great Depression
  195. The Global Financial Crisis
  196. The Great Depression
  197. Government Blunders
  198. Macroeconomics
  199. What Happened to the Miracle of Markets?
  200. Microeconomics
  201. Fallacy of Composition
  202. Paradox of Thrift
  203. Connections between Input and Output Markets
  204. The Macroeconomic Connection
  205. Money, Banks, and Expectations
  206. Do Market Economies Quickly Self-Adjust?
  207. The Fundamental Macroeconomic Question
  208. Say’s Law
  209. Keynesian Revolution
  210. Expectations
  211. Introducing Macroeconomics
  212. Refresh 5.1
  213. Should Government Be Hands-Off or Hands-On? Economics and Politics
  214. Market Failure versus Government Failure
  215. Market Failure
  216. Government Failure
  217. Economics Out There: Government as the Problem, Markets as the Solution
  218. “Yes — Left Alone, Markets Self-Adjust”
  219. Hands-Off
  220. “No — Left Alone, Markets Fail Often”
  221. Hands-On
  222. Economics Out There: “Fear the Boom and Bust” — A Hayek vs. Keynes Rap Anthem
  223. Are “Yes” and “No” the Only Answers? Macroeconomic Agreements
  224. The Fundamental Macroeconomic Question: Comparing Camps
  225. Refresh 5.2
  226. Adding Up Everyone’s Choices: Macroeconomic Outcomes and Players
  227. Three Key Macroeconomic Outcomes
  228. Unemployment
  229. Inflation
  230. Overview
  231. Can’t Tell the Players without a Scorecard: Macroeconomic Players
  232. Households as Consumers
  233. Businesses
  234. Government
  235. Government Choices
  236. Bank of Canada and the Banking System
  237. Rest of the World (R.O.W.)
  238. Refresh 5.3
  239. Focusing on Your Future: Why You Should Think Like a Macroeconomist
  240. Your Economic Future: Reason 1 for Thinking Like a Macroeconomist
  241. GDP
  242. Unemployment
  243. Inflation
  244. Even More Macroeconomics in Your Life
  245. Your Vote Matters: Reason 2 for Thinking Like a Macroeconomist
  246. You, Too, Can Think Enough Like a Macroeconomist
  247. Circular Flow Connections
  248. Hands-Off or Hands-On?
  249. Refresh 5.4
  250. Study Guide: Chapter 5 Summary
  251. 5.2 Should Government Be Hands-Off or Hands-On? Economics and Politics
  252. 5.3 Adding Up Everyone’s Choices: Macroeconomic Outcomes and Players
  253. 5.4 Focusing on Your Future: Why You Should Think Like a Macroeconomist
  254. True/False
  255. Multiple Choice
  256. 6 Up Around the Circular Flow GDP, Economic Growth, and Business Cycles
  257. 6 Up Around the Circular Flow GDP, Economic Growth, and Business Cycles
  258. Higher Prices, More Stuff, or Both? Nominal GDP and Real GDP
  259. Nominal GDP
  260. Current Prices
  261. Final Products and Services
  262. Produced Annually
  263. In a Country
  264. Graphing GDP
  265. Real GDP
  266. Real GDP per Person
  267. Refresh 6.1
  268. How to Measure GDP: Value Added and the Enlarged Circular Flow
  269. Value Added without Double Counting
  270. Double Counting
  271. Value Added Equals Value of Final Products and Services
  272. Value Added Equals Inputs’ Incomes
  273. Circular Flow of Income and Spending
  274. Enlarging the Circular Flow: Adding R.O.W.
  275. Income and Consumer Spending
  276. Business Investment Spending
  277. Government Spending on Products and Services
  278. R.O.W. Exports and Imports
  279. Aggregate Spending Equals Aggregate Income
  280. Why Subtract Imports?
  281. Enlarging the Circular Flow: Adding Banks
  282. Consumer Choices
  283. Business Choices
  284. Government Choices
  285. R.O.W. Choices
  286. Banks
  287. Say’s Law with Banks
  288. Enough Measuring
  289. Refresh 6.2
  290. When Macroeconomic Dreams Come True: Potential GDP and Economic Growth
  291. Potential GDP
  292. Potential GDP per Person
  293. Economic Growth
  294. Economic Growth and Production Possibilities Frontier
  295. Labour
  296. Capital
  297. Land and Other Natural Resources
  298. Entrepreneurship
  299. Expanding the Circular Flow
  300. Economics Out There: Wikinomics
  301. Measuring Economic Growth Rates
  302. Historical Growth Rates
  303. What’s in a Number?
  304. Compounding and the Rule of 70
  305. Productivity, Growth, and Living Standards
  306. Work Time per Purchase
  307. Productivity Is Everything
  308. Competition and Creative Destruction
  309. Refresh 6.3
  310. Boom and Bust: Business Cycles
  311. How to Speak Business Cycles
  312. Phases of a Business Cycle
  313. Output Gaps, Unemployment, and Inflation
  314. Refresh 6.4
  315. My GDP Is Bigger Than Yours: What’s Wrong with GDP as a Measure of Well-Being?
  316. What’s Missing from Real GDP?
  317. Underground Economy
  318. Environmental Damage
  319. Leisure
  320. Political Freedoms and Social Justice
  321. Growth Rates of Real GDP per Person are Better
  322. Where Would You Rather Live?
  323. Refresh 6.5
  324. Study Guide: Chapter 6 Summary
  325. 6.2 How to Measure GDP: Value Added and the Enlarged Circular Flow
  326. 6.3 When Macroeconomic Dreams Come True: Potential GDP and Economic Growth
  327. 6.4 Boom and Bust: Business Cycles
  328. 6.5 My GDP Is Bigger Than Yours: What’s Wrong with GDP as a Measure of Well-Being?
  329. True/False
  330. Multiple Choice
  331. 7 Costs of (Not) Working and Living Unemployment and Inflation
  332. 7 Costs of (Not) Working and Living Unemployment and Inflation
  333. Who Is Unemployed? Healthy and Unhealthy Types of Unemployment
  334. Out of Work Is Not Enough
  335. Calculating the Unemployment Rate
  336. Unemployment in Canada
  337. What the Unemployment Rate Misses
  338. Involuntary Part-Time Workers
  339. Discouraged Workers
  340. Economics Out There: Jobless Picture May Be Even Worse
  341. Regional Differences
  342. Healthy and Unhealthy Unemployment
  343. Frictional Unemployment
  344. Structural Unemployment
  345. Seasonal Unemployment
  346. Cyclical Unemployment
  347. Refresh 7.1
  348. How Full Is “Full Employment?” The Natural Rate of Unemployment
  349. Natural Rate of Unemployment and Potential GDP
  350. Recessionary Gap
  351. Inflationary Gap
  352. What Is the Natural Rate of Unemployment?
  353. Refresh 7.2
  354. Lightening Up Your Wallet: What Is Inflation?
  355. Consumer Price Index
  356. The CPI Shopping Basket
  357. Calculating the CPI
  358. Measuring the Inflation Rate
  359. Inflation in Canada
  360. Economics Out There: The Bank of Canada’s Inflation Calculator
  361. Core Inflation Rate
  362. Why Worry about Inflation?
  363. Falling Value of Money
  364. Falling Value of Money and Interest Rates
  365. Unpredictable Prices Discourage Planning and Investment
  366. Danger of Self-Fulfilling Expectations
  367. Acceptable Inflation
  368. Dangerous Downward Spirals: If Low Inflation Is OK, Is Deflation Better?
  369. Savers and Borrowers
  370. Falling Asset Values
  371. The Lesson of Japanese Deflation
  372. What the Inflation Rate Misses
  373. Standard of Living versus Cost of Living
  374. Switch to Cheaper Substitutes
  375. New and Better Products
  376. Refresh 7.3
  377. Inflation Starts with “M” The Quantity Theory of Money
  378. Money and the Circular Flow
  379. V is for Velocity
  380. P × Q is for Nominal GDP
  381. Fixing the Quantity Theory of Money
  382. More Money Causes Inflation
  383. Refresh 7.4
  384. When Tim Hortons Pays $18 per Hour: Unemployment and Inflation Trade-offs
  385. The Phillips Curve
  386. Demand-Pull Inflation
  387. Downward Demand-Pull Deflation
  388. OPEC Ends the Original Phillips Curve
  389. Supply Shocks and Cost-Push Inflation
  390. Cost-Push Inflation
  391. The Original Phillips Curve and Beyond
  392. Long-Run Phillips Curve
  393. Refresh 7.5
  394. Study Guide: Chapter 7 Summary
  395. 7.2 How Full Is “Full Employment?” The Natural Rate of Unemployment
  396. 7.3 Lightening Up Your Wallet: What Is Inflation?
  397. 7.4 Inflation Starts with “M” The Quantity Theory of Money
  398. 7.5 When Tim Hortons Pays $18 per Hour: Unemployment and Inflation Trade-offs
  399. True/False
  400. Multiple Choice
  401. 8 Skating to Where the Puck Is Going Aggregate Supply and Aggregate Demand
  402. 8 Skating to Where the Puck Is Going Aggregate Supply and Aggregate Demand
  403. Macroeconomic Performance Targets: Potential GDP and Long-Run Aggregate Supply
  404. From Production Possibilities Frontier to Long-Run Aggregate Supply
  405. Production Possibilities Frontier
  406. Long-Run Aggregate Supply
  407. Long Run versus Short Run
  408. Refresh 8.1
  409. If You Plan and Build It . . . Short-Run Aggregate Supply
  410. Short-Run Supply Plans with Existing Inputs
  411. Short-Run Aggregate Supply Curve
  412. The Law of Short-Run Aggregate Supply
  413. Supply Plans to Increase Inputs
  414. Increase in Potential GDP and Aggregate Supply
  415. Moving Along Curves versus Shifting Curves
  416. Changes in Input Prices and Aggregate Supply
  417. Supply Shocks and Short-Run Aggregate Supply
  418. Negative Supply Shocks Decrease Short-Run Aggregate Supply
  419. Positive Supply Shocks Increase Short-Run Aggregate Supply
  420. Will Supply Create Its Own Demand?
  421. Refresh 8.2
  422. . . . Will They Come and Buy It? Aggregate Demand
  423. Demand Plans and the Circular Flow
  424. Only One Aggregate Demand
  425. Aggregate Demand Curve
  426. Aggregate Demand
  427. The Law of Aggregate Demand
  428. Substitutions from R.O.W.
  429. Consumer Demand Choices: C is for Consumer Spending
  430. Business Demand Choices: I is for Business Investment Spending
  431. Investment Can Be Postponed
  432. Government Demand Choices: G is for Government Spending on Products and Services
  433. R.O.W. Demand Choices: X is for R.O.W. Spending on Canadian Exports
  434. Imports: IM Eliminates Canadian Choices from R.O.W. Spending
  435. Repeat Your Mantra: C + I + G + X – IM = Y
  436. Demand Shocks and Aggregate Demand
  437. Expectations
  438. Interest Rates
  439. Economics Out There: Putting Off Business Investment
  440. Government Policy
  441. GDP in R.O.W.
  442. Exchange Rates
  443. Aggregate Demand Summary
  444. Refresh 8.3
  445. Hit or Miss the Macroeconomic Performance Targets? The Aggregate Supply and Aggregate Demand Model
  446. Hitting the Targets: Long-Run Macroeconomic Equilibrium
  447. Equilibrium
  448. Short-Run Equilibrium with Existing Inputs
  449. Long-Run Equilibrium with Existing Inputs
  450. Equilibrium over Time with Increasing Inputs
  451. Living Standards
  452. Stable Prices
  453. Loanable Funds Market
  454. Rescuing Say’s Law over Time
  455. Rising Living Standards
  456. Missed Targets and Business Cycles
  457. Negative Demand Shocks
  458. Positive Demand Shocks
  459. Negative Supply Shocks
  460. Positive Supply Shocks
  461. Economic Life Is Full of Shocks
  462. Agreement between Camps?
  463. Refresh 8.4
  464. Shocking Starts and Finishes: Origins and Responses to Business Cycles
  465. Yes — Markets Self-Adjust, So Hands-Off
  466. Origins of Shocks and Business Cycles — “Yes” Camp
  467. Rational Expectations
  468. Market Price Responses to Business Cycles
  469. No — Markets Fail Often, So Hands-On
  470. Origins of Shocks and Business Cycles — “No” Camp
  471. Volatile Expectations and Money
  472. Market Price Responses to Business Cycles
  473. Yes or No: How Do You Decide?
  474. Comparing Camps: Origins of Shocks and Business Cycles
  475. Refresh 8.5
  476. Study Guide: Chapter 8 Summary
  477. 8.2 If You Plan and Build It . . . Short-Run Aggregate Supply
  478. 8.3 . . . Will They Come and Buy It? Aggregate Demand
  479. 8.4 Hit or Miss the Macroeconomic Performance Targets? The Aggregate Supply and Aggregate Demand Model
  480. 8.5 Shocking Starts and Finishes: Origins and Responses to Business Cycles
  481. True/False
  482. Multiple Choice
  483. 9 Money Is for Lunatics Demanders and Suppliers of Money
  484. 9 Money Is for Lunatics Demanders and Suppliers of Money
  485. Is It Smart to Not Want Money? Demand for Money
  486. What Does Money Do?
  487. Unit of Account
  488. Store of Value
  489. Are There Three Functions of Money?
  490. Why Hold Money?
  491. Liquidity
  492. What Money Can Buy and Bonds Can’t
  493. Why Hold Money to Store Value?
  494. Economics Out There: Canadians Sitting on a $1-Trillion Pile of Idle Cash
  495. How Much Money to Hold? Interest Rates and the Demand for Money
  496. Interest Rate as the Price of Money
  497. Macroeconomic Demand for Money
  498. What Changes the Demand for Money? Real GDP and Average Price Level
  499. Real GDP
  500. Average Price Level
  501. Refresh 9.1
  502. Legal Counterfeiting? Supply of Money
  503. Commodity Money
  504. Convertible Paper Money
  505. Fiat Money
  506. Deposit Money
  507. Economics Out There: Card Money in New France
  508. Measuring the Money Supply
  509. M1+ and M2+
  510. The Bank of Canada: Canada’s Central Bank
  511. Issuing Currency
  512. Banker to Chartered Banks
  513. Lender of Last Resort
  514. Banker to Government
  515. Conducting Monetary Policy
  516. How Banks Create Money: Profits versus Prudence
  517. An Offer You Can’t Refuse
  518. Making Money by Making Money
  519. Economics Out There: Banking Begins on the Street
  520. Loans and Money Creation Go Together
  521. Look Ma, No Reserves!
  522. Probabilities and Bank Runs
  523. Bank Profits versus Prudence
  524. The Supply of Money
  525. Higher Interest Rates, More Loans, Increased Quantity of Money Supplied
  526. Refresh 9.2
  527. What Is the Price of Money? Interest Rates, Money, and Bonds
  528. Opposites by Nature: Bond Prices and Interest Rates
  529. When Interest Rates Change, So Do Bond Prices
  530. Why Bonds Are Risky and Less Liquid Than Money
  531. Money Markets, Loanable Funds Markets, and Interest Rates
  532. Excess Demand for Money
  533. Excess Supply of Money
  534. A Multitude of Interest Rates
  535. Refresh 9.3
  536. Does Money Make the Real World Go Around? Domestic Transmission Mechanism from Money to Real GDP
  537. Money and Aggregate Supply
  538. Money Does Not Directly Affect Aggregate Supply
  539. Money and Aggregate Demand
  540. Domestic Transmission Mechanism between Money and Real GDP
  541. Lower Interest Rates Are a Positive Aggregate Demand Shock
  542. Higher Interest Rates Are a Negative Aggregate Demand Shock
  543. Refresh 9.4
  544. “Yes, Markets Self-Adjust” and “No, Markets Fail Often” as Facebook Friends? How Much Does Money Matter for Business Cycles?
  545. How Much Does Money Matter? “Yes — Markets Self-Adjust” Answer — “Not Much”
  546. Money Does Not Affect How Often Business Cycles Happen
  547. Money Helps Markets Adjust
  548. How Much Does Money Matter? “No — Markets Fail Often” Answer — “A Lot”
  549. Money Causes Business Cycles by Creating a Way Not to Spend
  550. Money Slows Market Adjustments
  551. Comparing Camps: How Much Money Matters for Business Cycles
  552. Refresh 9.5
  553. Study Guide: Chapter 9 Summary
  554. 9.2 Legal Counterfeiting? Supply of Money
  555. 9.3 What Is the Price of Money? Interest Rates, Money, and Bonds
  556. 9.4 Does Money Make the Real World Go Around? Domestic Transmission Mechanism from Money to Real GDP
  557. 9.5 “Yes — Markets Self-Adjust” and “No — Markets Fail Often” as Facebook Friends? How Much Does Money Matter for Business Cycles?
  558. True/False
  559. Multiple Choice
  560. 10 Trading Dollars for Dollars? Exchange Rates and Payments with the Rest of the World
  561. 10 Trading Dollars for Dollars? Exchange Rates and Payments with the Rest of the World
  562. Shuffling Off to Buffalo: Demand and Supply of Canadian Dollars
  563. How Much Does That Dollar Cost?
  564. Appreciation and Depreciation
  565. Non-Canadians Demanding Canadian Dollars
  566. Demand for Canadian Exports and Assets
  567. Law of Demand for Canadian Dollars
  568. Export Effect
  569. Supplying Canadian Dollars to Non-Canadians
  570. Demand for Imports and Foreign Assets
  571. Law of Supply for Canadian Dollars
  572. Import Effect
  573. The Prices of the Canadian Dollar: Foreign Exchange Rates
  574. Equilibrium Exchange Rate
  575. Excess Demand for Canadian Dollars
  576. Excess Supply of Canadian Dollars
  577. A Multitude of Exchange Rates
  578. Reciprocal Exchange Rates
  579. Multiple Currencies and Exchange Rates
  580. Refresh 10.1
  581. Dancing with Dollars: Fluctuating Exchange Rates
  582. Forces Changing Demand and Supply
  583. Interest Rate Differentials
  584. Increase in Canadian Interest Rate Differential
  585. Decrease in Canadian Interest Rate Differential
  586. Inflation Rate Differentials
  587. Increase in Canadian Inflation Rate Differential
  588. Decrease in Canadian Inflation Rate Differential
  589. Canadian Real GDP Changes
  590. Increasing Real GDP in Canada — Investors
  591. Decreasing Real GDP in Canada
  592. R.O.W. and Canadian Exports
  593. World Prices for Canadian Resource Exports
  594. Speculators and Changing Expectations
  595. Self-Fulfilling Expectations
  596. Speculators Reinforce Exchange Rate Forces
  597. Refresh 10.2
  598. How Exchange Rates Affect Your Life: International Transmission Mechanism
  599. Impact on Net Exports
  600. Economics Out There: High Canadian Dollar Threatens Twilight Sequels and Economic Recovery
  601. Depreciating Canadian Dollar Is a Positive Aggregate Demand Shock
  602. Economics Out There: Who Wins from a Falling Loonie?
  603. Impact on Inflation
  604. Appreciating Canadian Dollar Is Deflationary
  605. Depreciating Canadian Dollar Is Inflationary
  606. Exchange Rates and You
  607. Refresh 10.3
  608. Overvalued Compared to What? Purchasing Power Parity and Rate of Return Parity Anchors
  609. Law of One Price
  610. How Much for a Big Mac? Purchasing Power Parity
  611. When Purchasing Power Parity Exists
  612. When Purchasing Power Parity Does Not Exist
  613. The Hamburger Standard
  614. Limitations of Purchasing Power Parity
  615. Money Flows Where Interest Rates Are Highest: Rate of Return Parity
  616. Would You Like Your Exchange Rate Floating or Fixed?
  617. Refresh 10.4
  618. Where Do All the Dollars Flow? International Balance of Payments
  619. Current Account: Exports, Imports, and Interest and Transfer Payments
  620. Financial Account: Investments between Canada and R.O.W.
  621. Statistical Discrepancy
  622. Why International Payments Account Must Balance
  623. Current Account Deficit and Financial Account Surplus
  624. Current Account Surplus and Financial Account Deficit
  625. Mirror Images
  626. Why International Transactions and Exchange Rates Matter
  627. Refresh 10.5
  628. Study Guide: Chapter 10 Summary
  629. 10.2 Dancing with Dollars: Fluctuating Exchange Rates
  630. 10.3 How Exchange Rates Affect Your Life: International Transmission Mechanisms
  631. 10.4 Overvalued Compared to What? Purchasing Power Parity and Rate of Return Anchors
  632. 10.5 Where Do All the Dollars Flow? International Balance of Payments
  633. True/False
  634. Multiple Choice
  635. 11 Steering Blindly? Monetary Policy and the Bank of Canada
  636. 11 Steering Blindly? Monetary Policy and the Bank of Canada
  637. What Do Central Banks Do? Bank of Canada’s Objectives and Targets
  638. The Bank of Canada’s Job
  639. Refresh 11.1
  640. Target Shooting: Open Market Operations
  641. Interest Rate as a Driving Force
  642. Every Picture Tells a Story: Bank of Canada Homepage
  643. Moving Targets: Open Market Operations
  644. Accelerating with Lower Interest Rates
  645. Braking with Higher Interest Rates
  646. Predicting the Future with Aggregate Supply and Aggregate Demand
  647. Moving Targets Eight Dates a Year
  648. Changing the Money Supply to Change Interest Rates
  649. Buying Bonds to Increase the Money Supply
  650. Selling Bonds to Decrease the Money Supply
  651. Changing Bond Prices to Change Interest Rates
  652. Buying Bonds Increases the Price of Bonds
  653. Selling Bonds Decreases the Price of Bonds
  654. Interest Rates Move Together (Mostly)
  655. Refresh 11.2
  656. Driving with the Bank of Canada: Transmission Mechanisms
  657. Turning the Wheels of Aggregate Demand
  658. Domestic Effects of Interest Rates
  659. International Effects of Interest Rates
  660. Looking Inside the Transmissions
  661. Domestic Monetary Transmission Mechanism: Borrowing and Spending
  662. Lower Interest Rates Are a Positive Aggregate Demand Shock
  663. Higher Interest Rates Are a Negative Aggregate Demand Shock
  664. International Transmission Mechanisms: Exchange Rate Effects
  665. Depreciating Canadian Dollar Is a Positive Aggregate Demand Shock
  666. Appreciating Canadian Dollar Is a Negative Aggregate Demand Shock
  667. All Together Now: Reinforcing Transmission Mechanisms
  668. Lowering Interest Rates to Increase Aggregate Demand
  669. Raising Interest Rates to Decrease Aggregate Demand
  670. Not a Popularity Contest
  671. Refresh 11.3
  672. Transmission Breakdowns: Balance Sheet Recessions and Monetary Policy
  673. Stepping on the Gas?
  674. Almost Free Money
  675. Paying Down Debt Instead of Spending: Consumers and Businesses
  676. Businesses
  677. Money as a Store of Value
  678. Piling Up Reserves Instead of Lending: Banks
  679. Flooding the System with Money: Quantitative Easing and the Quantity Theory of Money
  680. Quantitative Easing
  681. Inflation Risks
  682. Economics Out There: Ben Bernanke is Time Magazine’s 2009 Person of the Year
  683. Driving with an Unpredictable Transmission: Timing Is Everything
  684. Refresh 11.4
  685. Who’s Driving? Anchoring Inflation Expectations
  686. Is the Bank or the Government of Canada Driving?
  687. The Coyne Affair
  688. Independence Matters
  689. Inflation–Unemployment Trade-offs and Expectations
  690. Speeding Is Easier than Braking, So Anchor Expectations
  691. High Inflation Is Unpredictable, Causing Not-Smart Choices
  692. “Yes, Hands-Off” and “No, Hands-On” Agree! Markets Need a Central Bank
  693. “Yes, Hands-Off”: Rules for Monetary Policy
  694. “No, Hands-On”: Discretion for Monetary Policy
  695. Economics Out There: Should the Bank of Canada Worry about Inflation or Deflation?
  696. Shake Hands
  697. Refresh 11.5
  698. Study Guide: Chapter 11 Summary
  699. 11.2 Target Shooting: Open Market Operations
  700. 11.3 Driving with the Bank of Canada: Transmission Mechanisms
  701. 11.4 Transmission Breakdowns: Balance Sheet Recessions and Monetary Policy
  702. 11.5 Who’s Driving? Anchoring Inflation Expectations
  703. True/False
  704. Multiple Choice
  705. 12 Spending Others’ Money Fiscal Policy, Deficits, and National Debt
  706. 12 Spending Others’ Money Fiscal Policy, Deficits, and National Debt
  707. Spenders of Last Resort: Aggregate Demand Policies for Stabilizing Business Cycles
  708. Virtuous and Vicious Circles: Multiplier Effects
  709. Net Taxes as Leakages
  710. Round and Round the Circle
  711. Leakages and the Multiplier Effect
  712. How Big Are Multiplier Effects?
  713. Tax and Transfer Multipliers
  714. Multipliers and Aggregate Demand
  715. Other Injections: Multiplier Effects and Business Cycles
  716. Business Investment Spending
  717. Export-Led Busts and Booms
  718. Filling the Gaps: Fiscal Policy and Aggregate Demand
  719. Recessionary Gaps and Expansionary Fiscal Policy
  720. Inflationary Gaps and Contractionary Fiscal Policy
  721. Multiplier Effects and Real GDP
  722. Hands-Off and Hands-On Choices for Demand-Side Fiscal Policies
  723. Hands-Off
  724. Hands-On
  725. Multipliers at Work
  726. Refresh 12.1
  727. Building Foundations: Aggregate Supply Policies for Promoting Growth
  728. Investing in the Future: Policies for Economic Growth
  729. Stimulate Saving and Capital Investment
  730. Encourage Research and Development
  731. Improve Education and Training
  732. To Save or To Spend? Hands-Off and Hands-On Supply-Side Differences
  733. Save!
  734. Spend!
  735. Long-Run or Short-Run?
  736. Supply-Siders and Voodoo Economics: Incentive Effects
  737. Supply-Siders
  738. Laffer Curve
  739. Too Good to Be True
  740. Refresh 12.2
  741. Are Deficits Always Bad? Government Budget Surpluses and Deficits
  742. Living on $264 Billion a Year: Government Budgets, Revenues, and Spending
  743. Government Revenues
  744. Government Spending
  745. Balancing the Budget
  746. Automatic Weapons for Stabilizing Business Cycles
  747. Automatic Stabilizers
  748. Smoothing Business Cycles
  749. Automatic Deficits and Surpluses
  750. Balanced Budgets Can Be Bad
  751. Economics Out There: Europe’s “Austerians” Need a Lesson on Multipliers and Macroeconomics
  752. Why Spend Other People’s Money?
  753. Deficits and Surpluses: Cyclical versus Structural
  754. Good Balanced Budgets over the Business Cycle
  755. Structural Deficits (and Surpluses) at Potential GDP
  756. Refresh 12.3
  757. We Owe How Much?! From Deficits to the National Debt
  758. Deficits Are a Flow
  759. Debt Is a Stock
  760. Counting to $600 Billion and Beyond: Measuring the National Debt
  761. What’s in a Number?
  762. Bad Debt or Good Debt? Myths and Problems about the National Debt
  763. 1. Will Canada Go Bankrupt?
  764. 2. Burden for Future Generations
  765. 3. Debt Is Always Bad
  766. 4. Interest Payments Create Self-Perpetuating Debt
  767. Economics Out There: Why Bother?
  768. 5. Crowding Out and Crowding In
  769. Myth or Truth?
  770. Refresh 12.4
  771. Are Deficits Like Potato Chips? Hands-Off or Hands-On Role for Government?
  772. Politics
  773. Loaded Words
  774. Opinions and Facts: Normative and Positive Statements
  775. Economics
  776. Positive Statements
  777. Normative Statements
  778. Mixing It Up: Politics and Economics
  779. Will Politicians Follow Economists’ Advice?
  780. Are You Hearing a Political or Economic Argument?
  781. Hands-Off or Hands-On? Your Choice
  782. Refresh 12.5
  783. Study Guide: Chapter 12 Summary
  784. 12.2 Building Foundations: Aggregate Supply Policies for Promoting Growth
  785. 12.3 Are Deficits Always Bad? Government Budget Surpluses and Deficits
  786. 12.4 We Owe How Much?! From Deficits to the National Debt
  787. 12.5 Are Deficits Like Potato Chips? Hands-Off or Hands-On Role for Government?
  788. True/False
  789. Multiple Choice
  790. 13 Are Sweatshops All Bad? Globalization and Trade Policy
  791. 13 Are Sweatshops All Bad? Globalization and Trade Policy
  792. Why Don’t You Cook Breakfast? Gains from Trade
  793. Voluntary Trade
  794. If You Trade, Should Canada?
  795. Canada Is a Trading Nation
  796. Bake or Chop?
  797. Production Possibilities Frontier
  798. Deal or No Deal? Opportunity Cost Rules
  799. Comparative Advantage
  800. Smart Deals
  801. Achieving the Impossible
  802. Terms of Trade
  803. Technology and Competition
  804. Refresh 13.1
  805. What’s So Wonderful about Free Trade? Protectionism and Trade
  806. Creative Destruction on a Global Scale
  807. Creative Destruction
  808. Winners and Losers from International Trade
  809. Winners
  810. Losers
  811. No Competition in My Backyard! Protectionism
  812. Tariffs
  813. Import Quotas
  814. Domestic Subsidies
  815. The Politics of Trade Policy
  816. Domestic Trade Politics
  817. International Trade Politics
  818. Arguments for Protectionism?
  819. Saving Canadian Jobs
  820. Necessary to Compete with Cheap Foreign Labour
  821. Valid, Limited Protectionism Arguments
  822. Trade Wars: Powerful Argument against Protectionism
  823. Refresh 13.2
  824. Globalization and Its Discontents Is Free Trade the Problem?
  825. The World Bank and International Monetary Fund
  826. Hands-Off Policies for Developing Countries
  827. Joseph Stiglitz Changes the Debate
  828. Economics Out There: Globalization and Its Discontents
  829. What Is Globalization?
  830. Why Is Globalization Happening?
  831. Sweatshops versus Farms
  832. Sweatshops throughout History
  833. Winners and Losers from Globalization
  834. Refresh 13.3
  835. Hands-Off or Hands-On Again? Governments and Global Markets
  836. Hands-On for Stiglitz
  837. Social Safety Nets
  838. Opening the Door to Trouble
  839. Hands-Off for The Economist Magazine
  840. Buried in Wool
  841. Whose Side Are They On?
  842. Practice What You Preach
  843. Terms of Trade
  844. Shake Hands?
  845. Limited Role for Government?
  846. Markets Failure or Government Failure?
  847. Travels of a T-Shirt
  848. Economics Out There: Travels of a T-Shirt in the Global Economy
  849. Your Hand at the Ballot Box
  850. Refresh 13.4
  851. Study Guide: Chapter 13 Summary
  852. 13.2 What’s So Wonderful about Free Trade? Protectionism and Trade
  853. 13.3 Globalization and Its Discontents: Is Free Trade the Problem?
  854. 13.4 Hands-Off or Hands-On Again? Governments and Global Markets
  855. True/False
  856. Multiple Choice
  857. Summing Up
  858. Why Learn to Think Like an Economist?
  859. Glossary
  860. Answers to the Study Guide Questions
  861. Chapter 2
  862. Chapter 3
  863. Chapter 4
  864. Chapter 5
  865. Chapter 6
  866. Chapter 7
  867. Chapter 8
  868. Chapter 9
  869. Chapter 10
  870. Chapter 11
  871. Chapter 12
  872. Chapter 13

 

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