University of Liverpool - ECON123: Principles of Macroeconomics

You'll delve into core macroeconomic concepts and theories, gaining insights into factors influencing national income, inflation, and unemployment. By examining government policies like fiscal and monetary measures, you'll see how they impact these critical economic indicators. The course also emphasises the framework of national income accounting, allowing you to analyse the economy and policy decisions through graphical and algebraic models. Furthermore, you'll explore the interconnectedness of goods, money, and labor markets, and gain a deeper understanding of long-term economic growth alongside short-term fluctuations.

Main topics to be covered:

• Introduction to the Module:

  • Overview and objectives of the macroeconomics module

• Introduction to Macroeconomics and the Goals of Policy:

  • Understanding macroeconomic principles and policy objectives

• National Income Accounting:

  • Measurement and analysis of national income

• The Determination of National Income:

  • Factors influencing national income determination

• The Keynesian Consumption Function:

  • Introduction to consumption theory in Keynesian economics

• The 45-Degree Line Diagram:

  • Graphical representation of equilibrium output

• Equilibrium Output and Adjustment to Equilibrium:

  • Analysis of equilibrium output and adjustment mechanisms

• The Multiplier Process:

  • Understanding the multiplier effect in macroeconomics

• Aggregate Demand, Fiscal Policy, and Foreign Trade:

  • Influence of fiscal policy on aggregate demand
  • Effects of foreign trade on income determination

• Money and Banking:

  • The role of money in the economy
  • Functions of fractional reserve banking and central banking

• Investment and Consumption:

  • Models of consumption behaviour
  • Determinants of investment and its impact on aggregate demand

• The IS-LM Model:

  • Analysis of the relationship between investment and saving, liquidity and money

• Demand Management and the Policy Mix:

  • Strategies for managing aggregate demand through policy instruments

• Aggregate Demand and Aggregate Supply:

  • Impact of prices on aggregate demand
  • Factors affecting aggregate supply and inflation

• Inflation:

  • Definition and causes of inflation
  • Types of inflation and their implications

• Unemployment:

  • Causes and consequences of unemployment
  • Policies to address unemployment issues

• Business Cycles:

  • Understanding the nature and theories of business cycles
  • Strategies for managing business cycles

• Growth:

  • Sources of economic growth
  • Policies to foster economic growth

• Endogenous Growth:

  • Theories and factors contributing to endogenous growth in economies