Econ 104 1st Edition Lecture 1Outline of Last Lecture I. This is the first Lecture!Outline of Current Lecture II. This is macroeconomicsIII. Current Macroeconomic Challenges of Washington, D.CIV. Other examples of Macro QuestionsCurrent LectureI. This is macroeconomicsa. Focusing on the economy of a nation vs microeconomics which dealt with the economic decisions of households. i. Macro deals with inflation, unemployment, national growth, GDP…b. Economics is “the study of mankind in the ordinary business of life” – Alfred Marshallc. The prefix makrois Greek and means “large”, o ikosmeans “house” and nomos means “law”d. Why is studying macroeconomics so important?i. It can answer the tough questions!1. Is the economy expanding or contracting?2. How does all of this affect the management of my finances and the business that I own?II. Current Macroeconomic Challenges of Washington, D.Ca. The current state of the economyi. One way of showing this is the United States Output Clock1. This shows what we ARE producing vs what we SHOULD be producing. The difference between these lines are the jobs lost, bankruptcies, home foreclosures, and businesses closing. 2. There was declining output from Dec 07 to June 09 during the great recessionb. Understanding why job creation is slowi. Can be shown through a graph of Total Number of Nonfarm Jobs. This shows potential employment and actual employment1. By September 2019 we should be back at the potential employment if we keep adding jobs at the current rateThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.2. 9 million jobs lost at the end of the recession3. Jobs aren’t being created because of low demand for outputc. The national debti. The debt clock keeps ticking!III. Other examples of Macro Questionsa. Should student loans be subsidized?i. Student debt>credit card debtii. July 2013 student loan interest rate jumped from 3.4% to 6.8%iii. To fix this the government could….1. Borrow more2. Cut back on other expenditures3. Raise taxes4. End the subsidiesa. In the end, it was voted to end the subsidies!b. Obama wants to raise minimum wage from $7.25 to $10.10i. PROS1. Move above poverty line2. Increased demand for goods and services3. Higher wage reduces turnover4. Raise worker productivity5. Keep wage up with inflationii. CONS1. Price of goods rise2. Less people hired3. Workers replaced by
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