Preface xvii

part 1

Introduction

Chapter 1

First Principles 5

Chapter 2

Economic Models: Trade-offs and Trade 25

Appendix

Graphs in Economics 51

part 2

Supply and Demand

Chapter 3

Supply and Demand 67

Chapter 4

Consumer and Producer Surplus 103

Chapter 5

Price Controls and Quotas: Meddling with Markets 103

Chapter 6

Elasticity 103

part 3

Individuals & Markets

Chapter 7

Taxes 169

Chapter 8

International Trade 169

part 4

Economics and Decision Making

Chapter 9

Taxes 169

Appendix

Toward a Fuller Understanding of Present Value 169

part 5

Economics and Decision Making

Chapter 10

The Rational Consumer  169

Appendix

Consumer Preferences and Consumer Choice 169

part 6

The Production Decision

Chapter 11

Behind the Supply Curve: Inputs and Costs  169

Chapter 12

Perfect Competition and the Supply Curve 169

part 7

Market Structure: Beyond Perfect Competition

Chapter 13

Monopoly 169

Chapter 14

Oligopoly 169

Chapter 15

Monopolistic Competition and Product Differentiation 169

part 8

Market Structure: Beyond Perfect Competition

Chapter 16

Externalities 169

Chapter 17

Public Goods & Common Resources 169

Chapter 18

The Economics of the Welfare 169

part 9

Factor Markets & Risk

Chapter 19

Factor Markets and the Distribution of Income 169

Appendix

Indifference Curve Analysis of Labor Supply  169

Chapter 20

Uncertainty, Risk, and Private Information 169

part 10

Introduction to Macroeconomics

Chapter 21

Macroeconomics: The Big Picture 169

Chapter 22

GDP and the CPI: Tracking the Macroeconomy 191

Chapter 23

Unemployment and Inflation 217

part 11

Long-Run Economic Growth

Chapter 24

Long-Run Economic Growth 245

Chapter 25

Savings, Investment Spending, and the Financial System 279

Appendix

Toward a Fuller Understanding of Present Value 313

part 12

Short-Run Economic Fluctuations

Chapter 26

Income and Expenditure 317

Appendix

Deriving the Multiplier Algebraically 347

Chapter 27

Aggregate Demand and Aggregate Supply 349

part 13

Stabilization Policy

Chapter 28

Fiscal Policy 385

Appendix

Taxes and the Multiplier 417

Chapter 29

Money, Banking, and the Federal Reserve System 419

Chapter 30

Monetary Policy 455

Appendix

Reconciling the Two Models of the Interest Rate 481

Chapter 31

Inflation, Disinflation, and Deflation 485

Chapter 32

Crises and Consequences 513

part 14

Events and Ideas

Chapter 33

Macroeconomics: Events and Ideas 539

part 15

The Open Economy

Chapter 34

Open-Economy Macroeconomics  563

Macroeconomic Data Tables M-1

Solutions to “Check Your Understanding” Questions S-1

Glossary G-1

Index I-1