Economics for Business (23115) Subject Notes

Description

Full semester of subject notes. Topics: INTRODUCTION - What is economics? - Ten principles of economics MARKET SUPPLY AND DEMAND - Markets and competition - Demand - Supply EQUILIBRIUM AND ELASTICITY - Supply and demand together - The elasticity of demand - The elasticity of supply GOVERNMENT POLICIES - Controls of prices - Taxes - Subsidies EFFICIENCY OF MARKETS AND THE COST OF TAXATION - Consumer surplus - Producer surplus - Market efficiency - The cost of taxation - The deadweight loss of taxation EXTERNALITIES - Externalities and market inefficiency - Public policies on externalities - Private solutions to externalities MACROECONOMICS AND MACRO VARIABLES - GDP AND PRICE INDICES - The measurements of GDP - The components of GDP - Real vs Nominal GDP - GDP and economic wellbeing - The consumer price index - The GDP deflator vs The CPI - Inflation - Nominal and real variables MACROECONOMIC PROBLEMS, UNEMPLOYMENT & INFLATION - Unemployment - Classical unemployment - Frictional unemployment - Structural unemployment - Demand deficient unemployment - Wage-induced unemployment - Total unemployment - Full employment - Inflation AGGREGATE DEMAND AND SUPPLY MODEL - Economic changes - The basic model of economic fluctuations - The long-run equilibrium - Economic fluctuations MONETARY POLICY AND FISCAL POLICY - Policy options - The meaning of money - The Reserve Bank of Australia - The money market - The theory of liquidity preference - Monetary policy and aggregate demand - The transmission mechanism - Current situation in Australia - Fiscal policy and aggregate demand - Government budget EXTERNAL SECTOR, BALANCE OF PAYMENTS & EXCHANGE RATES - Open economy - The international flows of goods and services - Balance of payments - Definition of the exchange rate - Supply curve of AUD in FEM - Demand curve of AUD in FEM - Factors affecting exchange rates