曼昆經(jīng)濟(jì)學(xué)原理Chapter 33

1、PowerPoint Slides prepared by: Andreea CHIRITESCUEastern Illinois UniversityAggregate Demand and Aggregate Supply1 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product o

2、r service or otherwise on a password-protected website for classroom use.Economic Fluctuations Economic activityFluctuates from year to year RecessionEconomic contraction period: declining real incomes and rising unemployment DepressionSevere recession Boom Economic expansion period 2 2012 Cengage L

3、earning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Economic FluctuationsThree key facts about economic fluc

4、tuations1. Economic fluctuations are irregular and unpredictable 2. Many macroeconomic quantities fluctuate togetherGDP, investment, consumption, etc. economy-wide phenomena 3. As output falls, unemployment rises3 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,

5、 in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Figure 14 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for

6、 use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.A Look at Short-Run Economic Fluctuations (a)This figure shows real GDP in panel (a), investment spending in panel (b), and unemployment in panel (c) for the U.

7、S. economy using quarterly data since 1965. Recessions are shown as the shaded areas. Notice that real GDP and investment spending decline during recessions, while unemployment rises.Figure 15 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part,

8、 except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.A Look at Short-Run Economic Fluctuations (b)This figure shows real GDP in panel (a), investment spending in panel (b), and unemployment in panel (c)

9、 for the U.S. economy using quarterly data since 1965. Recessions are shown as the shaded areas. Notice that real GDP and investment spending decline during recessions, while unemployment rises.Figure 16 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole

10、or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.A Look at Short-Run Economic Fluctuations (c)This figure shows real GDP in panel (a), investment spending in panel (b), and unemployment i

11、n panel (c) for the U.S. economy using quarterly data since 1965. Recessions are shown as the shaded areas. Notice that real GDP and investment spending decline during recessions, while unemployment rises.Short-Run Economic Fluctuations Classical dichotomy Separation of variables into real variables

12、 and nominal variables Monetary neutrality Changes in the money supplyAffect prices and other nominal variablesNot affect real variables (GDP, unemployment, other real variables) Classical theory holds in the long-run7 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplic

13、ated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Short-Run Economic Fluctuations In the short-run,Assumption of monetary neutrality - no longer appropriateReal and nominal

14、variables are highly intertwinedChanges in the money supplyCan temporarily push real GDP away from its long-run trend8 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain produ

15、ct or service or otherwise on a password-protected website for classroom use.Short-Run Economic Fluctuations AD-AS modelModel of aggregate demand (AD) & aggregate supply (AS)Most economists use this model to explain short-run fluctuations in economic activityAround its long-run trend9 2012 Cenga

16、ge Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Short-Run Economic Fluctuations Aggregate-demand cur

17、ve Shows quantity of goods and services that households, firms, government, and customers abroad want to buy at each price level Downward sloping Aggregate-supply curve Shows the quantity of goods and services that firms choose to produce and sell at each price level Upward sloping10 2012 Cengage Le

18、arning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Figure 211 2012 Cengage Learning. All Rights Reserved. Ma

19、y not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Aggregate Demand and Aggregate SupplyPriceLevelQuantity ofOutputEquilibriumprice levelAg

20、gregate supplyAggregate demandEquilibriumoutputEconomists use the model of aggregate demand and aggregate supply to analyze economic fluctuations. On the vertical axis is the overall level of prices. On the horizontal axis is the economys total output of goods and services. Output and the price leve

21、l adjust to the point at which the aggregate-supply and aggregate-demand curves intersect.Aggregate-Demand Curve Y = C + I + G + NX Three effects explain why AD curve slopes downward:Wealth effect (C )Interest-rate effect (I)Exchange-rate effect (NX) Assumption: government spending (G)Fixed by polic

22、y12 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Aggregate-Demand Curve Price level &am

23、p; consumption (C): wealth effect Decrease in price levelIncrease - real value of moneyConsumers wealthierIncrease in consumer spendingIncrease in AD 13 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a licens

24、e distributed with a certain product or service or otherwise on a password-protected website for classroom use.The Aggregate-Demand Curve Price level & investment (I): interest-rate effect Decrease in price levelDecrease interest rate As P decreases, money demand decreases (try to convert some o

25、f their money into interest-bearing assets), driving down interest rate Increase spending on investment goodsIncrease in AD 14 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certa

26、in product or service or otherwise on a password-protected website for classroom use.Aggregate-Demand Curve Price level & net exports (NX): exchange-rate effect Decrease in price levelDecrease interest rateDomestic currency depreciates Financial investors switch from domestic investment into inv

27、esting abroadStimulates net exportsIncrease in AD 15 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for cla

28、ssroom use.Aggregate-Demand Curve A fall in price levelIncreases quantity of goods and services demandedBecause: 1.Consumers are wealthier - stimulates the demand for consumption goods2.Interest rates fall - stimulates the demand for investment goods3.Currency depreciates - stimulates the demand for

29、 net exports16 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.The Aggregate-Demand Curve

30、A rise in price levelDecreases the quantity of goods and services demandedBecause: 1.Consumers are poorer depress consumer spending 2.Higher interest rates fall - depress investment spending3.Currency appreciates depress net exports17 2012 Cengage Learning. All Rights Reserved. May not be copied, sc

31、anned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Figure 318 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole

32、or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.The Aggregate-Demand CurvePriceLevelQuantity of OutputP1Aggregate demandY1A fall in the price level from P1 to P2 increases the quantity o

33、f goods and services demanded from Y1 to Y2. There are three reasons for this negative relationship. As the price level falls, real wealth rises, interest rates fall, and the exchange rate depreciates. These effects stimulate spending on consumption, investment, and net exports. Increased spending o

34、n any or all of these components of output means a larger quantity of goods and services demanded.P2Y21. A decrease in the price level . . .2. . . . increases the quantity ofgoods and services demandedAggregate-Demand Curve The AD curve might shift due to:Changes in consumptionChanges in investmentC

35、hanges in government purchasesChanges in net exports19 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for c

36、lassroom use.Aggregate-Demand Curve Changes in consumption, CEvents that change how much people want to consume at a given price levelChanges in taxes, wealth, or weather Increase in consumer spendingAD curve - shift right20 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or

37、duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Aggregate-Demand Curve Changes in investment, IEvents that change how much firms want to invest at a given price leve

38、lBetter technologyTax policyMoney supplyIncrease in investmentAD curve - shift right21 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a

39、password-protected website for classroom use.Aggregate-Demand Curve Changes in government purchases, GPolicy makers change government spending at a given price levelBuild new roadsIncrease in government purchases AD curve - shift right22 2012 Cengage Learning. All Rights Reserved. May not be copied,

40、 scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Aggregate-Demand Curve Changes in net exports, NXEvents that change net exports for a given price levelR

41、ecession in EuropeInternational speculators change in exchange rateIncrease (decrease) in net exports AD - shift right (left)23 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a cert

42、ain product or service or otherwise on a password-protected website for classroom use.Aggregate Supply Curve Distinguish long run aggregate supply and short run aggregate supply Long run aggregate-supply (LRAS) curveLRAS curve is verticalPrice level does not affect the long-run determinants of GDP:S

43、upplies of labor, capital, and natural resourcesAvailable technology24 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protect

44、ed website for classroom use.Aggregate Supply Curve Natural rate of outputProduction of goods and services that an economy achieves in the long run The level of production toward which the economy gravitates in the long runCorresponding to the natural rate of unemploymentPotential output (Full-emplo

45、yment output)25 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Figure 426 2012 Cengage Le

46、arning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.The Long-Run Aggregate-Supply CurvePriceLevelQuantity of

47、OutputIn the long run, the quantity of output supplied depends on the economys quantities of labor, capital, and natural resources and on the technology for turning these inputs into output. Because the quantity supplied does not depend on the overall price level, the long-run aggregate-supply curve

48、 is vertical at the natural rate of output.1. A change in the pricelevel . . .2. . . . does not affect the quantity of goods and services supplied in the long runLong-runaggregatesupplyNatural rateof outputP1P2Aggregate Supply Curve The LRAS curve might shift due toAny change in natural rate of outp

49、utChanges in laborChanges in capitalChanges in natural resourcesChanges in technological knowledge27 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or o

50、therwise on a password-protected website for classroom use.Aggregate Supply Curve Changes in laborQuantity of labor increasesAggregate supply shifts rightNatural rate of unemployment increases(Eg.) Increase minimum wageAggregate supply shifts left Changes in capitalCapital stock increasePhysical and

51、 human capitalAggregate supply shifts right28 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom

52、use.Aggregate Supply Curve Changes in natural resourcesNew discovery of natural resourceAggregate supply shifts rightChange in weather pattern Changes in technologyNew better technologyAggregate supply shifts rightSimilar results obtained due to International trade Government regulation29 2012 Cenga

53、ge Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Long-Run Trends In long run: both AD and LRAS curve

54、shiftContinual shifts of LRAS curve to rightTechnological progressAD curve shifts to rightMonetary policy (increases in money supply by central bank over time)Result: Continuing growth in outputContinuing inflation30 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicat

55、ed, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Figure 531 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except

56、 for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.Long-Run Growth and Inflation in the Model of Aggregate Demand and Aggregate SupplyPriceLevelQuantity of OutputAs the economy becomes better able to produce

57、 goods and services over time, primarily because of technological progress, the long-run aggregate-supply curve shifts to the right. At the same time, as the Fed increases the money supply, the aggregate-demand curve also shifts to the right. In this figure, output grows from Y1990 to Y2000 and then

58、 to Y2010, and the price level rises from P1990 to P2000 and then to P2010. Thus, the model of aggregate demand and aggregate supply offers a new way to describe the classical analysis of growth and inflation.LRAS1990Y1990AD1990P1990LRAS2000Y2000AD2000LRAS2010Y2010P2000AD2010P20101. In the long run,

59、 technological progress shifts long-run aggregate supply2. . . . and growth in the money supply shifts aggregate demand . . .3. . . . leading to growth in output . . .4. . . . andongoing inflationSR Aggregate Supply Curve The short-run Aggregate Supply:Increase in overall level of prices in economyT

60、ends to raise the quantity of goods and services suppliedDecrease in level of pricesTends to reduce quantity of goods and services suppliedUpward-sloping SRAS curve32 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license di