1. Macroeconomics Looking at the Big Picture

2. Composed of three main things Measurements of economic performance Evaluation Developing Policy

3. Measurements: Trying to measure the Level of Economic Activity  Basically measures Supply and Demand 1 Businesses can affect the whole economy

4. Who Collects? Why Collect this information? How would You use this information? The fact of the matter is our Economy is Unstable

5. Three types of Fluctuations Seasonal Secular Cyclical

6. The Business Cycle Peak/Prosperity Expansion/Recovery Recession/ contraction Level of Economy Time Trough/Depression

7. Indicators In order for economists to determine where we are in the business cycle we use Indicators. Three types:  Coincident  Leading  Lagging

8. #1 Economic Indicator GDP  Gross domestic Product  The market Value of all final goods and services produced within a nation in a given period of time.  No Intermediate Goods  Only made in Boarders of US

9. What about Price changes? Two types of GDP to account for price. Nominal GDP: # produced X $ in that year = Nominal GDP Real GDP: # produced X $ in Base year = Real GDP

10. GDP = GPA of economy What does GPA actually measure? Is GPA an accurate measure of your learning throughout High School? Why or Why not?  Fill out the Box

11. GNP: Gross National Product The market value of all final goods and services produced by the residents of a nation in a given period of time. Basically, all goods and services produced by American companies

12. GDP = Total Spending Who spends? Consumers (C) Government (G) Business (I) Net Exports (Exports - Imports) (X)

13. Who does most of the spending? How do you know? Who Should do the most spending?

14. Missing in GDP: Non-market activities Underground Economy Quality of life

15. GDP: IN or OUT Think of types of economic activities that are: Included in GDP Excluded in GDP

16. “When it comes time for GDP, what counts?” Coding:  Underline important details  Circle new names  * New terms  ? Mark anything unclear There will be more to do with these when finished