Introduction to Macroeconomics

Fundamentals of Macroeconomics

Gain a foundational understanding of macroeconomic systems, core concepts such as GDP and productivity, and key models that explain how national income flows and economic stability is achieved.

Topics Covered

• Introduction to Macroeconomics
  This section introduces macroeconomics as a distinct branch of economics focused on the behavior of the economy as a whole. Learners will explore how it differs from microeconomics by focusing on aggregate indicators such as inflation, national income, and employment, and how these are influenced by government policies, international trade, and investment flows.
• Circular Flow of Income
  The circular flow model explains how income moves through an economy among households, firms, the government, and foreign sectors. This topic highlights the interdependence between production and consumption and illustrates how goods, services, and monetary flows sustain the economy’s functioning. The course will delve into two-sector, three-sector, and four-sector models to provide a comprehensive understanding.
• Gross Domestic Product (GDP)
  Learners will examine how GDP serves as a key indicator of economic performance. The course covers the three main approaches to calculating GDP: production, income, and expenditure. It also explains the difference between nominal and real GDP, along with GDP deflators, and discusses limitations in using GDP as a measure of societal well-being.
• Productivity
  This section explores how productivity—defined as output per unit of input—affects economic growth and living standards. It will examine the role of technology, education, capital investments, and institutional factors in enhancing productivity. The implications of productivity trends for employment and competitiveness will also be discussed.
• Recessions
  Students will learn to identify the macroeconomic indicators that signal a recession and explore historical examples to understand their causes and consequences. This section explains how recessions impact consumption, investment, and employment, and introduces key concepts such as negative growth, output gap, and fiscal/monetary policy responses.
• Macroeconomic Models
  An overview of essential macroeconomic models including the Aggregate Demand–Aggregate Supply (AD-AS) model and the IS-LM model. Learners will understand how these tools are used to analyze shifts in the economy, predict outcomes of policy decisions, and assess economic equilibrium under various conditions.