Principles of Macroeconomics 2e covers the scope and sequence of most introductory economics courses. The text includes many current examples, which are handled in a politically equitable way. The outcome is a balanced approach to the theory and application of economics concepts. The second edition has been thoroughly revised to increase clarity, update data and current event impacts, and incorporate the feedback from many reviewers and adopters.Changes made in Principles of Macroeconomics 2e are described in the preface and the transition guide to help instructors transition to the second edition.

By the end of this section you will be able to:Explain how exchange rate shifting influences aggregate demand and supplyExplain how shifting exchange rates also can influence loans and banks

By the end of this section, you will be able to:Explain how expansionary fiscal policy can shift aggregate demand and influence the economyExplain how contractionary fiscal policy can shift aggregate demand and influence the economy

By the end of this section, you will be able to:Explain the nature and causes of unemploymentAnalyze the natural rate of unemployment and the factors that affect itIdentify how undeveloped labor markets can result in the same hardships as unemployment

By the end of this section, you will be able to:Contrast expansionary monetary policy and contractionary monetary policyExplain how monetary policy impacts interest rates and aggregate demandEvaluate Federal Reserve decisions over the last forty yearsExplain the significance of quantitative easing (QE)

By the end of this section, you will be able to:Analyze whether monetary policy decisions should be made more democraticallyCalculate the velocity of moneyEvaluate the central bank’s influence on inflation, unemployment, asset bubbles, and leverage cyclesCalculate the effects of monetary stimulus

In this chapter, you will learn about:Macroeconomic Perspectives on Demand and SupplyBuilding a Model of Aggregate Demand and Aggregate SupplyShifts in Aggregate SupplyShifts in Aggregate DemandHow the AD/AS Model Incorporates Growth, Unemployment, and InflationKeynes’ Law and Say’s Law in the AD/AS Model

By the end of this section, you will be able to:Explain real GDP, recessionary gaps, and inflationary gapsRecognize the Keynesian AD/AS modelIdentify the determining factors of both consumption expenditure and investment expenditureAnalyze the factors that determine government spending and net exports