Macroeconomics

9 780073 362465 9 0 0 0 0 www.mhhe.com ISBN 978-0-07-336246-5 MHID 0-07-336246-8 Comprehensive. Current. Clear. Steve Slavin walks you through concepts and graphs to help you think like an economist. Check out the exciting new material in the Ninth Edition. For the Student: • Learning Objectives tied to the Study Guide make studying more productive. • “On the Web” feature directs you to interesting websites. • Questions for Further  ought and Discussion now includes a “Practical Application” question in each chapter. For the Instructor: • Homework Manager for Economics makes assigning and grading homework more time eff ective. • Coverage of current events enhances classroom discussion. • Updated instructor materials facilitate planning and minimize prep work. www.mhhe.com/slavin9e Macroeconomics Stephen L. Slavin ninth edition ninth edition Macroeconomics Stephen L. Slavin MD DALIM #965493 05/29/08 CYAN MAG YELO BLK Macroeconomics sLa62468_fm_i-xxiv.indd Page i 6/10/08 8:01:19 PM user-s208sLa62468_fm_i-xxiv.indd Page i 6/10/08 8:01:19 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 U RBAN ECONOMICS O’Sullivan Urban Economics Seventh Edition L ABOR ECONOMICS Borjas Labor Economics Fourth Edition McConnell, Brue, and Macpherson Contemporary Labor Economics Eighth Edition P UBLIC FINANCE Rosen and Gayer Public Finance Eighth Edition Seidman Public Finance First Edition E NVIRONMENTAL ECONOMICS Field and Field Environmental Economics: An Introduction Fifth Edition I NTERNATIONAL ECONOMICS Appleyard, Field, and Cobb International Economics Sixth Edition Pugel International Economics Fourteenth Edition King and King International Economics, Globalization, and Policy: A Reader Fifth Edition E SSENTIALS OF ECONOMICS Schiller Essentials of Economics Seventh Edition Brue and McConnell Essentials of Economics Second Edition P RINCIPLES OF ECONOMICS McConnell and Brue Economics, Microeconomics, and Macroeconomics Eighteenth Edition Colander Economics, Microeconomics, and Macroeconomics Seventh Edition Frank and Bernanke Principles of Economics, Principles of Microeconomics, and Principles of Macroeconomics Fourth Edition Schiller The Economy Today, The Micro Economy Today, and The Macro Economy Today Eleventh Edition Slavin Economics, Microeconomics, and Macroeconomics Ninth Edition Samuelson and Nordhaus Economics, Microeconomics, and Macroeconomics Eighteenth Edition Miller Principles of Microeconomics First Edition E CONOMICS OF SOCIAL ISSUES Guell Issues in Economics Today Fourth Edition Sharp, Register, and Grimes Economics of Social Issues Eighteenth Edition ECONOMETRICS Gujarati and Porter Basic Econometrics Fifth Edition Gujarati and Porter Essentials of Econometrics Fourth Edition M ANAGERIAL ECONOMICS Baye Managerial Economics and Business Strategy Sixth Edition Thomas and Maurice Managerial Economics Ninth Edition Brickley, Smith, and Zimmerman Managerial Economics and Organizational Architecture Fifth Edition I NTERMEDIATE ECONOMICS Dornbusch, Fischer, and Startz Macroeconomics Tenth Edition Bernheim and Whinston Microeconomics First Edition Frank Microeconomics and Behavior Seventh Edition A DVANCED ECONOMICS Romer Advanced Macroeconomics Third Edition M ONEY AND BANKING Cecchetti Money, Banking, and Financial Markets Second Edition The McGraw-Hill Series Economics sLa62468_fm_i-xxiv.indd Page ii 6/10/08 8:01:24 PM user-s208sLa62468_fm_i-xxiv.indd Page ii 6/10/08 8:01:24 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 Macroeconomics NINTH EDITION Stephen L. Slavin Union County College Cranford, New Jersey The New School University New York City Boston Burr Ridge, IL Dubuque, IA New York San Francisco St. Louis Bangkok Bogotá Caracas Kuala Lumpur Lisbon London Madrid Mexico City Milan Montreal New Delhi Santiago Seoul Singapore Sydney Taipei Toronto sLa62468_fm_i-xxiv.indd Page iii 6/10/08 8:01:24 PM user-s208sLa62468_fm_i-xxiv.indd Page iii 6/10/08 8:01:24 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 MACROECONOMICS Published by McGraw-Hill/Irwin, a business unit of The McGraw-Hill Companies, Inc., 1221 Avenue of the Americas, New York, NY, 10020. Copyright © 2009, 2008, 2005, 2002, 1999, 1996, 1994, 1991, 1989 by The McGraw-Hill Companies, Inc. All rights reserved. No part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written consent of The McGraw-Hill Companies, Inc., including, but not limited to, in any network or other electronic storage or transmission, or broadcast for distance learning. Some ancillaries, including electronic and print components, may not be available to customers outside the United States. This book is printed on acid-free paper. 1 2 3 4 5 6 7 8 9 0 DOW/DOW 0 9 8 ISBN 978-0-07-336246-5 MHID 0-07-336246-8 Editorial director: Brent Gordon Executive editor: Douglas Reiner Developmental editor : Anne E. Hilbert Senior marketing manager: Melissa Larmon Project manager: Dana M. Pauley Lead production supervisor: Carol A. Bielski Lead designer: Matthew Baldwin Senior photo research coordinator: Lori Kramer Photo researcher: Keri Johnson Lead media project manager: Brian Nacik Typeface: 10/12 Times Compositor: Aptara , Inc. Printer: R. R. Donnelley Library of Congress Cataloging-in-Publication Data Slavin, Stephen L. Macroeconomics/Stephen L. Slavin.—9th ed. p. cm.— (The McGraw-Hill series economics) Includes index. ISBN-13: 978-0-07-336246-5 (alk. paper) ISBN-10: 0-07-336246-8 (alk. paper) 1. Macroeconomics. I. Title. HB172.5.S554 2009 339—dc22 2008010540 www.mhhe.com sLa62468_fm_i-xxiv.indd Page iv 6/10/08 8:01:26 PM user-s208sLa62468_fm_i-xxiv.indd Page iv 6/10/08 8:01:26 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 Preface to the Instructor A s an undergraduate economics student, I never imagined writing a textbook—let alone one going into its ninth edition. Back in those good old days, economics texts were all stand-alone books without any supplements, and seldom cost students more than fi ve dol- lars. While we certainly need to keep up with the times, not all change is for the good. Surely not when our stu- dents are paying $150 for textbooks they barely read. Why not write a book that students would actually enjoy reading and sell it at a price they can afford? Rather than serving up the same old dull fare, why not just have a conversation with the reader, illustrating various eco- nomic concepts anecdotally? Economics can be a rather intimidating subject, with its extensive vocabulary, complicated graphs, and quantita- tive tendencies. Is it possible to write a principles text that lowers the student’s anxiety level without watering down the subject matter? To do this, one would need to be an extremely good writer, have extensive teaching experience, and have solid academic training in economics. In this case, two out of three is just not good enough. Why did I write this book? Probably my moment of decision arrived more than 25 years ago when I men- tioned to my macro class that Kemp-Roth cut the top personal income tax bracket from 70 percent to 50 per- cent. Then I asked, “If you were rich, by what percentage were your taxes cut?” The class sat there in complete silence. Most of the stu- dents stared at the blackboard, waiting for me to work out the answer. I told them to work it out themselves. I waited. And I waited. Finally, someone said, “Twenty percent?” “Close,” I replied, “but no cigar.” “Fourteen percent?” someone else ventured. “No, you’re getting colder.” After waiting another two or three minutes, I saw one student with her hand up. One student knew that the answer was almost 29 percent— one student in a class of 30. When do they teach students how to do percentage changes? In high school? In middle school? Surely not in a college economics course. How much of your time do you spend going over simple arithmetic and algebra? How much time do you spend going over simple graphs? Wouldn’t you rather be spending that time discussing economics? Now you’ll be able to do just that, because all the arithmetic and simple algebra that you normally spend time explaining are covered methodically in this book. All you’ll need to do is tell your students which pages to look at. The micro chapters offer scores of tables and graphs for the students to plot on their own; the solutions are shown in the book. Learning actively rather than pas- sively, your students will retain a lot more economics. As an economics instructor for more than 30 years at such fabled institutions as Brooklyn College, New York Institute of Technology, St. Francis College (Brooklyn), and Union County College, I have used a variety of texts. But each of their authors assumed a mathematical back- ground that the majority of my students did not have. Each also assumed that his graphs and tables were com- prehensible to the average student. The biggest problem we have with just about any book we assign is that many of our students don’t bother to read it before coming to class. Until now, no one has written a principles text in plain English. I can’t promise that every one of your students will do the readings you assign, but at least they won’t be able to complain any- more about not understanding the book. Distinctive Qualities My book has six qualities that no other principles text has. 1. It reviews math that students haven’t done since middle school and high school. 2. It’s an interactive text, encouraging active rather than passive reading. Students are expected to solve numerical problems, fi ll in tables, draw graphs, and do economic analysis as they read the text. 3. It’s a combined textbook and workbook. Each chapter is followed by workbook pages that include multiple-choice and fi ll-in questions, as well as numerical problems. 4. It costs substantially less than virtually every other text on the market. And it has a built-in study guide. 5. It’s written in plain English without jargon. See for yourself. Open any page and compare my writing style with that of any other principles author. This book is written to communicate clearly and concisely with the students’ needs in mind. 6. It is written with empathy for students. My goal is to get students past their math phobias and fear of graphs by having them do hundreds of problems, step-by-step, literally working their way through the book. v sLa62468_fm_i-xxiv.indd Page v 6/10/08 8:01:26 PM user-s208sLa62468_fm_i-xxiv.indd Page v 6/10/08 8:01:26 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 Special Features Four special features of the book are its integrated coverage of the global economy, its extra help boxes, its advanced work boxes, and its end-of-chapter current issues . The Global Economy Until the early 1970s our economy was largely insulated from the rest of the world economy. All of this changed with the oil price shock of 1973, our subsequent growing appetite for fuel-effi cient Japanese compact cars, as well as for TVs, DVD players, cell phones, personal comput- ers, and other consumer electronics made in Asia. As our trade defi cits grew, and as foreigners bought up more and more American assets, every American became quite aware of how integrated we had become within the global economy. The ninth edition has three chapters devoted entirely to the global economy—Chapter 31 (International Trade), Chapter 32 (International Finance), and Chapter 8 (The Export-Import Sector). This chapter is part of the sequence (C, I, G, and X n ) leading up to the chapter on GDP. In addition, we have integrated a great deal of material dealing specifi cally with the global economy throughout the text. Here are some of the things we look at: • Shipbreaking (Ch. 3, p. 57) • The “Isms”: Capitalism, Communism, Fascism, and Socialism (Ch. 3, pp. 63–66) • The Decline of the Communist System (Ch. 3, p. 66) • The American Consumer: World-Class Shopper (Ch. 5, p. 115) • Why Did Incorporation Come So Late to Islamic Middle-Eastern Nations? (Ch. 6, pp. 126–127) • Foreign Investment in the United States (Ch. 6, p. 131) • Are We Giving Away the Store? (Ch. 7, p. 149) • Trillion Dollar Economies (Ch. 9, p. 201) • Comparative Unemployment Rates (Ch. 10, p. 226) • Surplus or Defi cit as Percentage of GDP, Selected Countries (Ch. 12, p. 292) • Economic Growth during the Last Millennium (Ch. 16, p. 390) • Children Living in Poverty in Various Countries (Ch. 17, p. 426) Extra Help Boxes Students taking the principles course have widely varying backgrounds. Some have no problem doing the math or understanding basic economic concepts. But many others are lost from day one. I have provided dozens of Extra Help boxes for the students who need them. They are especially useful to instructors who don’t want to spend hours of class time going over material that they assume should be under- stood after one reading. Of course these boxes can be skipped by the better prepared students. Here are some of the topics covered in the Extra Help boxes: • Finding the Opportunity Cost (Ch. 2, p. 36) • How Changes in Demand Affect Equilibrium (Ch. 4, p. 76) • How Changes in Supply Affect Equilibrium (Ch. 4, p. 78) • Price Ceilings, Price Floors, Shortages, and Surpluses (Ch. 4, pp. 82) • How Did We Get an Average Tax Rate of 15%? (Ch. 7, p. 152) • Calculating Percentage Changes (Ch. 9, p. 196) • Read Only if You’re Not Sure How to Calculate the Unemployment Rate (Ch. 10, p. 199) • Finding Percentage Changes in the Price Level (Ch. 10, p. 231) • Finding Equilibrium GDP (Ch. 11, p. 266) • Finding the Multiplier (Ch. 12, p. 282) • Does Printing More Money Increase Our Money Supply? (Ch. 14, p. 346) • Finding the Percentage of Income Share of the Quin- tiles in Figure 1 (Ch. 17, p. 417) • Interpreting the Top Line in Figure 5 (Ch. 19, p. 484) Advanced Work Boxes There are some concepts in the principles course that many instructors will want to skip. (Of course, if they’re not included in principles texts, this will make other instructors quite unhappy.) These boxes are intended for the better prepared students who are willing to tackle these relatively diffi cult concepts. vi Preface to the Instructor sLa62468_fm_i-xxiv.indd Page vi 6/10/08 8:01:26 PM user-s208sLa62468_fm_i-xxiv.indd Page vi 6/10/08 8:01:26 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 Here is a sampling of my Advanced Work boxes: • Post-World War II Recessions (Ch. 1, p. 12) • The Law of Increasing Costs (Ch. 2, p. 34) • APCs Greater than One (Ch. 5, p. 99) • Nominally Progressive, Proportional, and Regressive Taxes (Ch. 7, p. 154) • Should Cigarettes Be Taxed? (Ch. 7, p. 158) • Why NDP Is Better than GDP (Ch. 9, p. 192) • Calculating Per Capita Real GDP (Ch. 9, p. 202) • The Paradox of Thrift (Ch. 12, p. 283) • Money versus Barter (Ch. 13, p. 307) • Three Modifi cations of the Deposit Expansion Multi- plier (Ch. 14, p. 338) • Rational Expectations versus Adaptive Expectations (Ch. 15, p. 377) • The Malthusian Theory of Population (Ch. 16, p. 408) • The Yuan vs. the Dollar (Ch. 19, p 485) Current Issues Students often ask, “How does any of this affect me?” Or, “Why do I have to study economics?” The Current Issues provide answers to those questions. Each is a practical application of at least one of the concepts covered in the chapter. Chapter 1: America’s Place in History (p. 18) Chapter 2: Will You Be Underemployed When You Graduate? (p. 39) Chapter 3: The Bridge to Nowhere (p. 68) Chapter 4: High Gas Prices: Something Only an Economist Could Love (p. 86) Chapter 5: The American Consumer: World-Class Shopper (p. 115) Chapter 6: “Benedict Arnold Corporations”? (p. 139) Chapter 7: Will Social Security Be There for You? (p. 165) Chapter 8: Is Your School Sweatshirt Sewn in a Sweatshop? (p. 182) Chapter 9: GDP or GPI? (p. 208) Chapter 10: Where Are All the Jobs? (p. 242) Chapter 11: Keynes and Say in the 21st Century (p. 269) Chapter 12: Defi cits as Far as the Eye Can See (p. 297) Chapter 13: Overdraft Privileges (p. 323) Chapter 14: The Housing Bubble and the Subprime Mortgage Mess (p. 353) Chapter 15: Is George W. Bush a Supply-Sider or a Keynesian? (p. 382) Chapter 16: Health Care Costs in the Coming Decades (p. 409) Chapter 17: Will You Ever Be Poor? (p. 439) Chapter 18: Buy American? (p. 469) Chapter 19: Editorial: American Exceptionality (p. 494) What’s New and Different in the Ninth Edition ? There are two main additions. Most chapters now include one or two “On the Web” blurbs, which direct the student to interesting websites. And I’ve added a practical appli- cation to the “Questions for Thought and Discussion” at the end of virtually every chapter. You’ll also fi nd extensive coverage of the economic slowdown (that was not yet classifi ed as an offi cial reces- sion in the spring of 2008) which begin in late 2007. See various sections of Chapters 1, 10, 12, 13, 14, and 15 in Economics and Macroeconomics. At the urging of several reviewers, I’ve switched the order of Chapter 3 and 4. In the micro sequence, you can now go directly from Chapter 4, “Supply and Demand” to Chapter 5 (in the Micro split) or Chapter 17 in Economics , “Demand, Supply, and Equilibrium.” All Workbook and Test Bank questions are now tied to the chapter Learning Objectives, so that students and teachers can easily con- nect the lessons to homework and exams. • Chapter 3: Was Chapter 4 in eighth edition. • Chapter 4: Was Chapter 3 in eighth edition. • Chapter 5: Expanded “Saving” and “The Saving Func- tion” section. Added section, “Maintaining a ‘Basic’ Standard of Living.” • Chapter 6: Added section, “Why Isn’t Education Spending Classifi ed as Investment?” • Chapter 10: Added section “Are Economic Fluctua- tions Becoming Less Extreme?” • Chapter 12: Expanded sections, “Public Works” and “Who Makes Fiscal Policy?” Inserted section on Fiscal Policy Lags from Chapter 15. • Chapter 13: Added section, “Other Useful Properties of Money.” • Chapter 14: Inserted sections, “The Creation and Destruction of Money” and “The Liquidity Trap,” Preface to the Instructor vii sLa62468_fm_i-xxiv.indd Page vii 6/10/08 8:01:27 PM user-s208sLa62468_fm_i-xxiv.indd Page vii 6/10/08 8:01:27 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 from Chapter 13. Inserted section on Monetary Policy Lags from Chapter 15 Appendix. • Chapter 15: Integrated most of the previous edition Chapter 15 Appendix into the Chapter. • Chapter 17: Rewrote section, “Differences in Wages and Salaries.” Streamlined section, “Who Are the Poor?” • Chapter 18: Added section, “Absolute Advantage.” • The Test Bank is now tagged to Learning Objectives, AACSB categories, and Bloom’s Taxonomy. The Supplement Package The Macroeconomics supplement package has been stream- lined and updated for the ninth edition. All supplements are available at www.mhhe.com/slavin9e. In addition to updated online quizzes, the Test Bank is now tagged for Learning Objectives, AACSB categories, and Bloom’s Taxonomy. Also, the PowerPoint presentations for each chapter have been revised to increase relevance and clarity. Instructor’s Manual This provides instructors with ideas on how to use the text, includes a description of the text’s special features, a chapter-by-chapter discussion of material new to the ninth edition, and a rundown of chapter coverage to help them decide what they can skip. Also found here are the answers to the workbook questions and questions for thought and discussion at the end of each chapter of the text, as well as chapter worksheets and worksheet solutions. Mark Maier, who has used the text for several edi- tions, took over the Instructor’s Manual in the sixth edi- tion, and has added sections on chapter objectives, ideas for use in class, and homework questions and projects (including scores of very useful websites) for each chap- ter. The Instructor’s Manual now provides a rich source of interesting ideas of classroom activities and discussions involving concepts and issues included in the text. Test Bank The test bank now includes over 9,000 multiple-choice questions, fi ll-in questions, and problems tagged to Learning Objectives, AACSB categories, and Bloom’s Taxonomy. My thanks to Jerry Dunn and Ralph May from Southwestern Oklahoma State University, who took over the testbank for the ninth edition, and have kept it current, culling outdated questions and adding new ones. My thanks also to Deborah M. Figart and Ellen Mutari of Richard Stockton College of New Jersey for perform- ing a review of the test bank material. Computerized Testing The test bank is available in computerized versions for PCs. Developed by EZ Test, this state of the art software has the capability to create multiple tests, “scramble,” and produce high-quality graphs. PowerPoint Presentations PowerPoint presentations are available and can be cus- tomized by the professor for length and level. Todd Myers from Grossmont College has done a great job updating and revising these presentations to highlight the most important concepts from each chapter. Digital Image Library All the graphs from the text are available in chapter-specifi c fi les for easy download. These images will aid in classroom presentations and the student’s understanding. Videos A selection of videos is available to adopters, including both tutorial lessons and programs that combine historical footage, documentary sequences, interviews, and analysis to illustrate economic theory. A series of videos produced by Paul Solman, business and economics correspondent for the Lehrer News Hour and WGBH Boston, covers the core topics in economics. McGraw-Hill’s Homework Manager Plus TM McGraw-Hill’s Homework Manager Plus is a complete, Web-based solution that includes and expands upon the actual problem sets and the graphing exercises found in the Workbook pages at the end of each chapter. Virtually all Workbook questions are autogradable and all of them conveniently tied to the Learning Objectives in the text. McGraw-Hill’s Homework Manager delivers detailed results which let you see at a glance how each student performs on an assignment or an individual problem. This valuable feedback also helps you gauge the way the class performs overall. This online supplement can be used for student practice, graded homework assignments, and for- mal examinations; the results easily integrate with WebCT and Blackboard. viii Preface to the Instructor sLa62468_fm_i-xxiv.indd Page viii 6/10/08 8:01:27 PM user-s208sLa62468_fm_i-xxiv.indd Page viii 6/10/08 8:01:27 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 Website Some of the text’s unique qualities are incorporated in a dynamic new website. Completely updated online multiple- choice quizzes, revised by Ellen Mutari, serve to reinforce the material covered in every chapter. Also available on the website are new pre- and posttests, created by Deborah Figart. These online multiple-choice quizzes emphasize the chapter Learning Objectives and offer further reinforcement of important chapter concepts. Acknowledgments Over the years since the fi rst edition, hundreds of people have helped in large and small ways to shape this text. I especially wish to thank past editors Gary Nelson, Tom Thompson, Paul Shensa, and Doug Hughes. Anne Hilbert, the developmental editor, saw this project through from the fi rst reviews, the chapter-by-chapter revisions, the Test Bank and Instructor Manual revisions, and the dozens of deadlines that we met, to the time the book fi nally went into production. Anne was great at keep- ing all the plates spinning, dealing with a diverse group of personalities, making sure that all the pieces fi t, and seeing to it that the text and the supplements were ready to go. Project manager Dana Pauley, with whom I worked day to day, managed the copyediting, artwork, and page proofs, and saw to it that we stayed not just on schedule, but ahead of schedule. Karen Nelson did a very thorough copyediting job, fi nding errors and inconsistencies, some of which originated in earlier editions. Also, special thanks to proofreader Nym Pedersen for exceptional attention to detail. Matt Baldwin oversaw the design of the book from cover to cover. Payal Malik, the project manager at Aptara Corporation delivered an attractive and accurately com- posed text. Lead media project manager Brian Nacik made sure the supplement production process went smoothly. Brent Gordon, the Vice President and Editor-in-Chief, Douglas Reiner, the executive editor, and Anne Hilbert, the developmental editor, were all involved from start to fi nish. In addition to making sure that the text and all the supplements were printed on schedule, they looked for- ward to hearing suggestions from instructors using the text. Dan Silverberg, the Director of marketing, Ashley Smith, the marketing manager, and Jennifer Jelinski, the marketing specialist, have been working to help the book reach an even wider audience than the eighth edition. Every economist knows that no product sells itself. Without major sales and marketing efforts, my text could not sell very well. Most of the credit goes to all the McGraw-Hill Irwin sales reps for all their efforts to sell my book. And I would especially like to thank the reps in Dubuque, Iowa, who have personally accounted for about a quarter of our sales. Thomas Parsons (Massachusetts Bay Path Commu- nity College), Ronald Picker (St. Mary of the Woods College), Tom Andrews (West Chester State University), Christine Amsler (Michigan State), and Jim Watson (Jefferson College) very generously provided numerous suggestions which greatly improved the text. I also want to thank Ellen Mutari for her thorough accuracy check of all the in-text problems. You may have been wondering who took that great photo of me on the author’s page. The photographer is Leontine Temsky, who happens to be my sister. She also found a great website, www.zillow.com, which tells you instantly ho w much your house is worth. You’ll fi nd dozens of useful websites listed throughout the text. I’d also like to thank the many reviewers who helped improve this text. Sindy Abadie, Southwest Tennessee Community College Shawn Abbott, College of the Siskiyous (California) Kunle Adamson, DeVry College of New Jersey Carlos Aguilar, El Paso Community College Rashid B. Al-Hmoud, Texas Tech University Ashraf Almurdaah, Los Angeles City College Nejat Anbarci, Florida International University Guiliana Campanelli Andreopoulos, William Patterson University Thomas Andrews, West Chester University Jim Angus, Dyersburg State Community College (Tennessee) Lee Ash, Skagit Valley College John Atkins, Pensacola Junior College Lyndell L. Avery, Penn Valley Community College (Missouri) James Q. Aylsworth, Lakeland Community College John Baffoe-Bonnie, Pennsylvania State University Mohsen Bahmani-Oksooee, University of Wisconsin, Milwaukee Kathleen Bailey, Eastern Arizona College Kevin Baird, Montgomery Community College Gyanendra Baral, Oklahoma City Community College Patrick Becker, Sitting Bull College David Bennett, Ivy Tech (Indiana) Derek Berry, Calhoun Community College John Bethune, Barton College (North Carolina) Robert G. Bise, Orange Coast College John Bockino, Suffolk County Community College Van Bullock, New Mexico State University James Burkard, Nashville State Community College Gerard A. Cahill, Florida Institute of Technology Joseph Calhoun, Florida State University Joy Callan, University of Cincinnati Preface to the Instructor ix sLa62468_fm_i-xxiv.indd Page ix 6/10/08 8:01:27 PM user-s208sLa62468_fm_i-xxiv.indd Page ix 6/10/08 8:01:27 PM user-s208 /Volumes/101/MHBR062/sLa9fm%0/Volumes/101/MHBR062/sLa9fm%0 [...]... Understanding the importance and value of AACSB accreditation, Macroeconomics, 9e has sought to recognize the curricula guidelines detailed in AACSB standards for business accreditation by connecting selected questions in the test bank to the general knowledge and skill guidelines found in the AACSB standards The statements contained in Macroeconomics, 9e are provided only as a guide for the users of... The AACSB leaves content coverage and assessment within the purview of individual schools, the mission of the school, and the faculty While Macroeconomics, 9e and the teaching package make no claim of any specific AACSB qualification or evaluation, we have, within Macroeconomics, 9e labeled selected questions according to the six general knowledge and skills areas sLa62468_fm_i-xxiv.indd Page xiii 6/10/08... economic fluctuations in Economics and Macroeconomics In Chapter 2, we’ll be looking at the concept of full employment, but you can grasp intuitively that when our economy enters even a minor downturn, we are operating at less than full employment 4 “Brother, Can You Spare a Dime?” was a depression era song written by Yip Harburg and Jay Gorney 5 In Chapter 12 of Economics and Macroeconomics we’ll explain how... Your comments and suggestions have helped to make this the best edition yet —Stephen L Slavin Assurance of Learning Ready Assurance of learning is an important element of many accreditation standards Macroeconomics, 9e is designed specifically to support your assurance of learning initiatives Each chapter in the book begins with a list of numbered learning objectives, which appear throughout the chapter,... economy By June, the economy had turned around again, and this time the expansion would continue for seven years The outbreak 6 These policies will be discussed in Chapters 12 and 14 of Economics and Macroeconomics The recession of 1937–38 Franklin D Roosevelt, thirty-second president of the United States sLa75799_ch01_001-024.indd Page 10 5/28/08 10:10:02 AM user-s173 10 /Volumes/MH-BURR/MHBR019/MHBR019-01 . workbook. Each chapter is followed by workbook pages that include multiple-choice and fi ll-in questions, as well as numerical problems. 4. It costs substantially less than virtually every other text. Illinois, Chicago Dennis Shannon, Southwestern Illinois College Mehdi S. Shariati, Kansas City Kansas Community College Rimma Shiptsova, Utah State University Stephen Shmanske, California State. Every test bank question is also linked to one of these objectives, in addition to level of diffi culty, Bloom s Taxonomy level, and AACSB skill area. EZ Test , McGraw-Hill s easy-to-use test bank