Fundamentals of Macroeconomics

Week 1: Introduction and Gross Domestic Product
Macroeconomic aggregates and Gross Domestic Product. The value added and the return of productive factors. The components of GDP. Real and nominal GDP and the GDP deflator. The determinants of productivity in the long run.

Week 2: Savings and Investment. Labor Market. Consumer Price Index
Savings and investment in a closed economy. The market for loanable funds. Main statistics of the labor market. Types of unemployment: the natural rate and the cyclical unemployment. The consumer price index and the measurement of inflation.

Week 3: Money, monetary system and inflation
Definitions of money. The fractional-reserve banking system. The central banks. The tools for monetary control. Money demand, money supply,and price level determination. The quantity theory of money and the causes of inflationover the long run.

Week 4: Open economies and exchange rates
Open economies and trade balances. Capital flows. The relationship between savings, investment,and capital flows in open economies. Nominal and real exchange rate. The Purchasing-power Parity theory for determination of nominal exchange rates. The relationship between inflation and depreciation.

Week 5: Economic fluctuations
Empirical regularities of economic fluctuations. The aggregate demand curve. The long-run aggregate supply curve. The short-run aggregate supply curve. The long-run equilibrium and the short run economic fluctuations.

Week 6: Fiscal and Monetary Policies
The money demand and the theory of liquidity preference. The impact of monetary policies on the aggregate demand. Fiscal policies and the multiplier effect. Fiscal policies and the crowding-out effect. The argument for and against the use of fiscal and monetary policy to stabilize the economy.