sixth edition - lrc.tnu.edu.vnlrc.tnu.edu.vn/upload/collection/brief/39913_21102013826391.pdfcosts...

S i x t h E d i t i o n

T a b l e o f C o n t e n t s

PART 1 INTRODUCTION TO ECONOMICS 1. The Central Idea

Together, these two chapters introduce economics.

Consider this chapter an old fnend to consult in both micro and macro. Experience an economist's idea of sensitivity.

2. Observing and Explaining the Economy APPENDIX: Reading, Understanding, and Creating Graphs

3. The Supply and Demand Model 4. Subtleties of the Supply and Demand Model:

Price Floors, Price Ceilings, and Elasticity

PART 2 PRINCIPLES OF MICROECONOMICS

See the invisible hand theorem, stated and proved.

5. The Demand Curve and the Behavior of Consumers APPENDIX: Consumer Theory with Indifference Curves

6. The Supply Curve and the Behavior of Firms 7. The Interaction of People in Markets

PART 3 THE ECONOMICS OF THE FIRM

Realistic models of good and bad firms. starting up. shutting down, making profits. innovating, setting pnces.

8. Costs and the Changes at Firms over Time APPENDIX: Producer Theory with Isoquants

9. The Rise and Fall of Industries 10. Monopoly 11. Product Differentiation, Monopolistic

Competition, and Oligopoly 12. Antitrust Policy and Regulation

PART 4 MARKETS, INCOME DISTRIBUTION, AND PUBLIC GOODS

This market is slower but surer than the stock market Learn how government can correct market failure, and sometimes tail itseff

Learn about the slock market

13. Labor Markets 14. Taxes, Transfers, and Income Distribution 15. Public Goods, Externalities, and Government

Behavior 16. Capital Markets

APPENDIX: Present Discounted Value

Sô hoa bơi Trung tâm Hoc liêu – ĐH TN http://www.lrc-tnu.edu.vn

PAF -ES OF MACROECONOMICS

Now macro starts, with a preview of coming attractions

Find out about the long-run fundamentals of macroeconomics.

17. Macroeconomics: The Big Picture APPENDIX: The Miracle of Compound Growth

18. Measuring the Production, Income, and Spending of Nations

19. The Spending Allocation Model 20. Unemployment and Employment 21. Productivity and Economic Growth

APPENDIX: Deriving the Growth Accounting Formula 22. Money and Inflation

PART 6 ECONOMIC FLUCTUATIONS AND MACROECONOMIC POLICY

Here you'll learn how to use the same economic fluctuation model that the Fed and other central banks use.

These chapters explain how to ward off recessions and inflations.

23. The Nature and Causes of Economic Fluctuations APPENDIX: Deriving the Formula for the Keynesian Multiplier and the Forward-Looking Consumption Model

24. The Economic Fluctuations Model _25. Using the Economic Fluctuations Model 26. Fiscal Policy 27. Monetary Policy

PART 7 TRADE AND GLOBAL MARKETS

Why are some counthes poorer than others?

These chapters explain why economists love free trade.

28. Economic Growth and Globalization 29. The Gains from International Trade 30. International Trade Policy

> Asian Network tTlHtuj^^ noian ntuiviix The Taylor/Weerapana Economics, Sixth Edition website

L 3 for Higher Education provides a wealth of learning and review opportunities for students. Connect to the site via college.hmco.com/pic/

N0.(^ 0 S 3 taylor6e to review flashcards, take practice tests, see applications of economic concepts to curre.it events, link to useful research sites, and explore topics in more depth.


http://college.hmco.com/pic/

http://curre.it

E c o n o m i c s


A b o u t t h e A u t h o r s

John B. Taylor is one of the field's most inspiring teachers. As the Raymond Professor of Economics at Stanford University, his distinctive instructional methods have made him a legend among introductory economics students and have won him both the Uoagland and Rhodes prizes for teaching excellence. As described by the Wall Street Journal, Taylor's "sober

appearance... belies a somewhat zany teaching style." Few of his students forget how he first illustrated a shift of the demand curve (by dressing up as a California raisin and dancing to "Heard It Through the Grapevine"), or how he proved that the supply and demand model actually works (by having student buyers and sellers call out live bids to him in the classroom). It is this gift for clear explanations and memorable illustrations that makes his textbook so useful to students around the country.

Professor Taylor is also widely recognized for his research on the foundations of modern monetary theory and policy. One of his well-known research contributions is a rule—now widely called the Taylor Rule—used at central banks around the world. U.S. News and World Renoir wrote about his rule, "Amaze Your Friends! Predict the Fed's Next Move!" His latest research focuses on international monetary policy.

Taylor has had an active career in public service. recently completing a four-year stint as the head of the International Affairs division at the United States Treasury, where he had responsibility for currency policy, international debt, and oversight of the International Monetary Fund and the World Hank and worked closely with leaders and policymakers from countries throughout the world. I le has also served as economic adviser to the governor of his state (California), to the U.S. Congressional Budget Office, and to the President of the United Stales and has served on several boards and as a consultant to private industry.

Professor Taylor began his career at Princeton, where he graduated with highest honors in economics. He then received his Ph.D. from Stanford and taught at Columbia, Yale, and Princeton before returning to Stanford.

» ^ ^ ^ ^ ^ ^ Akila Weerapana is an Associate ^ K Economics ^ | Hk Wellesley College. He was born

and raised in Sri Lanka and came to the United States to do his undergraduate work at Oberlin College, where he earned a BA with highest honors in Economics and Computer Science in 1994. Inspired by his professors at Oberlin, he went on to graduate

school at Stanford University. He received his Ph.D. in Economics from Stanford in 1999, writing his dissertation on monetary economics under the menlorship of lohn Taylor. Having taught several classes at Stanford while he was a graduate student, Akila was determined to pursue a career as a liberal arts college professor, combining his research interests with the opportunity to teach economics to gifted college students. Since 1999. Akila has taught more than 800 students in the Economics Department at Wellesley College.

Akila's teaching interests span all levels of the department's curriculum, including introductory and intermediate macroeconomics, international finance, monetary economics, and mathematical economics. He was awarded Wellesley s Pinanski Prize for Excellence in Teaching in 2002. He also enjoys working with thesis students, having advised more than a dozen of these students at Wellesley. The projects that these students have worked on range from a study of the economic benefits of eradication of river blindness in Ghana to the impact of joining the European Union on the Spanish economy to analyzing the determinants of enterprise performance in Russia. He has advised many students who have pursued graduate study in economics or have gone on to work in economic research at the Federal Reserve.

In addition to teaching. Akila has research interests in macroeconomics, specifically in the areas of monetary economics, international finance, and political economv. In the area of monetary economics, his work focuses on the international dimensions of monetary policy, including the potential for gains from coordination and the importance of asymmetric relationships between countries. On the political economv side, his work examines the macroeconomic implications of political institutions and policy stances: examples include how the South African government's attitude towards the AIDS pandemic may affect exchange rates, how domestic economic growth responds to political institutions such as redistricting mechanisms and voter initiatives, and how political and economic variables can increase or decrease violent conflict.


S i x t h E d i t i o n

E c o n o m i c s


Executive Publisher: George Hoffman Executive Editor: Lise Johnson Sponsoring Editor: Kathleen Swanson Senior Marketing Manager: Nicole Hamm Associate Editor: Megan Hoar Senior Project Editor: Carol Merrigan Art and Design Manager: Jill Haber Cover Design Director: Tony Saizon Senior Photo Editor: Jennifer Meyer Dare Senior Composition Buyer: Chuck Dutton New Title Project Manager: James Lonergan Editorial Assistant: Angela Lang Marketing Assistant: Lauren Foye Cover photography: Harold Burch, New York City

Copyright © 2009 by Houghton Mifflin Company. All rights reserved. No part of this work may be reproduced or transmitted in any form or by any means. electronic or mechanical, including photocopying and recording, or by any information storage or retrieval system without the prior written permission of Houghton Mifflin Company unless such copying is expressly permitted by federal copyright law. Address inquiries to College Permissions. Houghton Mifflin Company. 222 Berkeley Street. Boston. MA 02116-3764. Printed in the U.S.A. Library of Congress Control Number: 2007934817

Instructor's examination copy: ISBN-10: 0-547-00474-5 ISBN-13: 978-0-547-00474-7

Eor orders, use student text ISBNs: ISBN-10: 0-618-96761-3 ISBN-13: 978-0-618-96761-2

1 2 3 4 5 6 7 8 9-VH-l 1 10 09 08 07


B r i e f C o n t e n t s

Microeconomics Macroeconomics Chapter Number Chapter Title Chapter Number Chapter Number PART 1 Introduction to Economic* PART 1 PART 1

1 The Central Idea 1 1 2 Observing and Explaining the Economy 2 2 2A APPENDIX to Chapter 2: Reading, Understanding, and Creating Graphs 2A 2A 3 The Supply and Demand Model 3 3 4 Subtleties of the Supply and Demand Model: Price Floors. Price Ceilings, and 4 4

Elasticity

PART 2 Principles of Microeconomics PART 2 5 The Demand Curve and the Behavior of Consumers 5 5A APPENDIX to Chapter 5: Consumer Theory with Indifference Curves 5A 6 The Supply Curve and the Behavior of Firms 6 7 The Interaction of People in Markets 7

PART 3 The Economics of the Firm PART 3 8 Costs and the Changes at Firms over Time 8 8A APPENDIX to Chapter 8: Producer Theory with Isoquants 8A 9 The Rise and Fall of Industries 9 10 Monopoly 10 11 Product Differentiation, Monopolistic Competition, and Oligopoly 11 12 Antitrust Policy and Regulation 12

PART 4 Markets, Income Distribution, and Public Goods PART 4 13 Labor Markets 13 14 Taxes.Transfers, and Income Distribution • J. 15 Public Goods, Externalities, and Government Behavior 15 16 Capital Markets 16 16: Financial Markets 16A APPENDIX to Chapter 16: Present Discounted Value 16A 16A

v


vi Brief Contents

Economics Principles of Principles of Microeconomics Macroeconomics

Chapter Number Chapter me Chapter Number Chapter Number PART s Principles of Macroeconomics PART 1 17 Macroeconomics: The Big Picture

17A APPENDIX to Chapter 17: The Miracle of Compound Growth 5A 18 Measuring the Production, Income, and Spending of Nations 6 19 The Spending Allocation Model 20 Unemployment and Employment 8

21 Productivity and Economic Growth 9 21A APPENDIX to Chapter 21: Deriving the Growth Accounting Formula 9A 22 Money and Inflation

PART 6 Economic Fluctuations and Macraeconomic Policy PART 3 23 The Nature and Causes of Economic Fluctuations 11

23A APPENDIX to Chapter 23: Deriving the Formula for the Keynesian 11A Multiplier and the Forward Looking Consumption Model

24 The Economic Fluctuations Model 12 25 Using the Economic Fluctuations Model 13 26 Fiscal Policy 1 4

27 Monetary Policy 1 5

PART 7 Trade and Global Markets PART 5 PART 4 28 Economic Growth and Globalization 17

29 The Gains from International Trade 17 18 30 International Trade Policy 18 19


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