Macroecon(Econ100B)

Macroecon(Econ100B) - Agenda The Practice of Macroeconomics...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
1 1-1 The Policy and Practice of Macroeconomics 1-2 Agenda • The Practice of Macroeconomics • Macroeconomic Policy 1-3 The Practice of Macroeconomics Macroeconomics is the study of economic activity and prices in the national economy. Macroeconomics is the study of: 1. The structure, dynamic adjustment, and performance of national economies, and 2. The government policies that affect national economic performance. 1-4 The Practice of Macroeconomics The Process: Developing Macro Models Macroeconomist explain how the economy works by using economic theory and models. An economic theory is a set of ideas about the economy, organized in a logical framework. Economic models are simplified representations of the economic phenomenon under consideration.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 1-5 The Practice of Macroeconomics The Process: Developing Macro Models Developing economic models requires 8 steps: 1. Identify an interesting economic question. 2. Specify the endogenous variables . 3. Specify the exogenous variables . 4. Hypothesize the relationship between them. 1-6 The Practice of Macroeconomics The Process: Developing Macro Models Developing economic models requires 8 steps: 5. Empirically test the relationship. 6. Evaluate the results. 7. Use the model to make further predictions and/or 8. Use the model to formulate policy. 1-7 The Practice of Macroeconomics The Purpose: Interpreting Macro Data Macroeconomics focuses on 3 main economic indicators: 1. Real GDP 2. The Unemployment Rate 3. Inflation 1-8 The Practice of Macroeconomics
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/05/2011 for the course ECON 100B taught by Professor Wood during the Spring '08 term at Berkeley.

Page1 / 7

Macroecon(Econ100B) - Agenda The Practice of Macroeconomics...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online