FERNANDO QUIJANO
Principles of
Economics
EN
ENGLISH
Models and College Notes
INNOVATE PUBLISHING, Bogotá, Colombia
FIRST EDITION
This website is continuously under construction
Table of Contents
PRINCIPLES OF MICROECONOMICS
PRINCIPLES OF MACROECONOMICS
Examine the sample chapter
PART I: Economic Activity
Chapter 1: Economics: The Science of Scarcity
Chapter 2: Economic Systems and Activities
PART II: The Market System
Chapter 3: Model of the Market: Demand, Supply and Equilibrium
Chapter 4: Participation in Exchange and Distribution of Gains
Chapter 5: Elasticity: A Measure of Responsiveness
PART III: Economic Units
Chapter 6: The Model of Consumer Behavior
Chapter 7: The Model of the Firm: Production and Costs
PART IV: Market Structures
Chapter 8: The Model of Perfect Competition
Chapter 9: The Model of Monopoly
Chapter 10: Monopolistic Competition and Oligopoly
1.1
1.2
1.3
1.4
2.1
2.2
2.3
2.4
3.1
3.2
3.3
3.4
3.5
3.6
4.1
4.2
4.3
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
6.1
6.2
6.3
6.4
6.5
6.6
7.1
7.2
7.3
7.4
7.5
8.1
8.2
8.3
8.4
8.5
8.6
9.1
9.2
9.3
9.4
9.5
10.1
10.2
10.3
10.4
10.5
What is economics all about?
Economic models
Essential math concepts for the study of the economic principles
Four fundamental concepts in economics
Scarcity and trade-offs: the production possibilities frontier
Gains derived from specialization and exchange
Economic systems
Interaction between economic agents in a market economy
Functions and components of a market
Demand function
Supply function
Equilibrium and disequilibrium in the market
Comparative statics
Simple model of price determination
Market participation and gains
Price controls and changes in economic surplus
Externalities: market failure
Concept and uses of elasticity
Price elasticity of demand
Price elasticity of supply
Cross elasticity of demand
Income elasticity
Elasticity and firm revenue
Extreme elasticities
Elasticity, equilibrium, and dead weight loss
The purpose of consumer theory
Utility and diminishing marginal returns
Consumer preferences and indifference curves
The consumer's budget
Equilibrium in the consumer model
Derivation of the individual and market demand curves
Conceptos preliminares
Producción y rendimientos en el corto plazo
Costos de la firma en el corto plazo
La firma en el largo plazo
Optimización en el uso de los insumos
Market structures and the model of perfect competition
Revenues and costs of the competitive firm
Profits
Losses: To produce or not to produce?
Individual and market supply curves
Perfect competition in the long run: efficiency, returns to scale and the supply curve
Barriers to entry
Demand and revenue structure of the monopoly
Production costs
Profits, efficiency and regulation
Price discrimination
Assumptions and geometry of monopolistic competition
Monopolistic competition in the short and the long run
Oligopoly: games and strategies
Oligopoly and efficiency
Duopoly of Cournot
PART V: Macroeconomics in the Short and the Long Run
Chapter 11: Macroeconomics: Study of the Economy as a Whole and Aggregation Measures
Chapter 2: Business Cycle and Problems of the Economy in the Short Run: Unemployment and Inflation
Chapter 13: The Economy in the Long Run: Basis for Growth
PART VI: Descriptive Macroeconomics
Chapter 14: Circular Flow and Model of Aggregate Expenditure
Chapter 15: Financial Institutions and the Money Market
Chapter 16: Model of Aggregate Demand and Aggregate Supply, AD/AS
PART VII: Economic Policy
Chapter 17: Fiscal Policy
Chapter 18: Monetary Policy
PART VIII: The International Economy
Chapter 19: Balance of Payments and Equilibrium in the Open Economy
Chapter 20: The Foreign Exchange Market
Macroeconomic theory and aggregation concepts
The measurement of gross domestic product (GDP)
Nominal GDP and real GDP
Gross domestic product (GDP) and gross national product (GNP)
What is GDP able to measure?
The business cycle
Potential product and natural rate of unemployment
Relationship between output, employment and inflation throughout the business cycle
Topics, statistics and analysis of employment
Topics, statistics and analysis of inflation
Economic growth and real GDP per capita
Models of economic growth
The measurement of economic growth
Institutional framework for grwoth
Convergence and technological reach: catch-up
Circular flow and decomposition of aggregate income and expenditure
Loanable funds market and sector analysis of deficits and surpluses
The aggregate expenditure model and the consumption function
The two-sector economy
Functions and measures of money
The role of banks in the creation of money and functions of the central bank
Demand for money and money market
Impact of a change in the money supply on aggregate expenditure
Aggregate demand (AD)
Aggregate supply (AS)
Macroeconomic equilibrium and self-correcting mechanism
the Phillips curve
Economic policy
Public finances and fiscal policy
Fiscal policy in the model of aggregate expenditure
Goals and tools of monetary policy
Transmission mechanisms
Monetary policy in the model of aggregate demand and aggregate supply, AD/AS
Synchronization monetary policy and inflation expectatons
Composition and independence of the central bank
The Colombian trade balance
The balance of payments account
Identity of sector balances in national income accounts
The aggregate expenditure model and the open economy
Determination of the world price of a good
the exchange rate, quotations and exchange markets
Model of supply and demand for the foreign exchange market
Foreign exchange systems
Inflation and the real exchange rate
Terms of exchange
11.1
11.2
11.3
11.4
11.5
12.1
12.2
12.3
12.4
12.5
13.1
13.2
13.3
13.4
13.5
14.1
14.2
14.3
14.4
15.1
15.2
15.3
15.4
16.1
16.2
16.3
16.4
17.1
17.2
17.3
18.1
18.2
18.3
18.4
18.5
19.1
19.2
19.3
19.4
19.5
20.1
20.2
20.3
20.4
20.5