Macroeconomics, 2nd Edition by Pearson

4

MACROECONOMICS

macroeconomics deals with is, accordingly, the market for money or the mar-

ket for the holding and provision of money balances.

Macroeconomics, thus, attempts to understand the markets for goods,

bonds, labour, and money, and the way in which they influence each other.

Agents making intertemporal choices in these four interconnected markets

then become the natural subject domain of macroeconomics.

Before examining these four markets, we need to get familiar with some of

the jargon used by macroeconomists. Let us begin with income.

In a sense, we all know what this is. Individuals work or own small or big

businesses ...