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Unformatted text preview: Introduction and Preview January 18, 2012 Introduction to macroeconomics & The study of aggregate economic behavior- Macro: Aggregate price ( P ) and output ( Y ): eg. CPI and GDP- Micro: price and output of an individual good ( P apple , Y apple ) & Dynamics (behavior of economic variables over time)- Short Run vs. Long Run Issues:- economic growth- business cycles- employment and unemployment- in&ation- macroeconomic policy- International trade and exchange rate Aggregate output: GDP in the post-war US 1950 1960 1970 1980 1990 2000 2010 2000 4000 6000 8000 10000 12000 14000 Real Output (GDP, 2005 Dollars) Natural Level of Real Output Long-run economic growth & Why important: generally rising living standard & US experience: stong trend of growth, interrupted by recessions & Sources of growth: More inputs: population and labor force growth, increased capital More e cient use of inputs: productivity growth & Productivity growth is source of true growth in average living standards Percentage deviation of GDP from its natural level 1950 1960 1970 1980 1990 2000 2010-10-8-6-4-2 2 4 6 ( % ) Short-run economic &uctuations...
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This note was uploaded on 01/29/2012 for the course ECON 321 taught by Professor Sani during the Spring '08 term at Rutgers.

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slide_1 - Introduction and Preview January 18, 2012...

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