MACROECONOMICSAND THE GLOBAL BUSINESS ENVIRONMENT

What is Macroeconomics?

Copyright © 2005 John Wiley & Sons, Inc. All rights reserved. PowerPoint by Beth IngramUniversity of Iowa

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Macroeconomics

An analysis of the backdrop of economic conditions against which firms and consumers make decisions

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Goals

Importance of Economic Policy Issues Significance of Firm-Specific and Aggregate

Risk Assessment of Long-Run Economic

Environment

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Consumers and Workers

How much to work?

How much and what to buy?

How much to save?

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Firms

How many worker to hire?

How much capital to purchase?

Where to sell products?

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Policy Makers

Fiscal Authority Controls tax system Purchases goods and services Redistributes income

Monetary authority Controls money supply Influences interest rates and exchange rates

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Summary

Definition of macroeconomics Importance of macroeconomics

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