Transcript Why should an MBA student, study Macroeconomics

Why should an MBA
student, study
Macroeconomics ?
Why should an MBA student,
study Macroeconomics ?
Because you need to understand the national
and international economic environment
that you are functioning in. You need to
know:
Why should an MBA student,
study Macroeconomics ?
• your suppliers
Why should an MBA student,
study Macroeconomics ?
•
your suppliers
• customers
Why should an MBA student,
study Macroeconomics ?
•
•
your suppliers
customers
• competitors
Why should an MBA student,
study Macroeconomics ?
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•
your suppliers
customers
competitors
• legal system
Why should an MBA student,
study Macroeconomics ?
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•
your suppliers
customers
competitors
legal system
• regulations
Why should an MBA student,
study Macroeconomics ?
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your suppliers
customers
competitors
legal system
regulations
• how to interpret economic decisions made
by the:
Why should an MBA student,
study Macroeconomics ?
•
•
•
•
•
your suppliers
customers
competitors
legal system
regulations
• how to interpret economic decisions made
by the:
– congress,
Why should an MBA student,
study Macroeconomics ?
•
•
•
•
•
•
your suppliers
customers
competitors
legal system
regulations
how to interpret economic decisions made by the:
– congress,
– the president, and
Why should an MBA student,
study Macroeconomics ?
•
•
•
•
•
•
your suppliers
customers
competitors
legal system
regulations
how to interpret economic decisions made by the:
– congress,
– the president, and
– the Federal reserve system
Why should an MBA student,
study Macroeconomics ?
•
•
•
•
•
•
your suppliers
customers
competitors
legal system
regulations
how to interpret economic decisions made by the:
– congress,
– the president, and
– the Federal reserve system
Why should an MBA student,
study Macroeconomics ?
•
•
•
•
•
•
your suppliers
customers
competitors
legal system
regulations
interpret economic decisions made by the:
– congress,
– the president, and
– the Federal reserve system
• the overall health of the economy.
What is macroeconomics ?
macroeconomics is the study of the economy
as a whole.
What is macroeconomics ?
macroeconomics is the study of the economy as a whole.
study of
It is the
What is macroeconomics ?
macroeconomics is the study of the economy as a whole.
study of
• total output
It is the
What is macroeconomics ?
macroeconomics is the study of the economy as a whole. It is the study of
• total output
• growth rate of the GDP
What is macroeconomics ?
macroeconomics is the study of the economy as a whole. It is the study of
• total output
• growth rate of the GDP
• inflation rate
What is macroeconomics ?
macroeconomics is the study of the economy as a whole. It is the study of
• total output
• growth rate of the GDP
• inflation rate
• unemployment rate
What is macroeconomics ?
macroeconomics is the study of the economy as a whole. It is the study of
• total output
• growth rate of the GDP
• inflation rate
• unemployment rate
• foreign sector
What is macroeconomics ?
macroeconomics is the study of the economy as a whole. It is the study of
• total output
• growth rate of the GDP
• inflation rate
• unemployment rate
• foreign sector
• exchange rate
Distinguishing Features of
Macroeconomics ?
• Data is aggregated to see the big picture
rather than small economic units
Distinguishing Features of
Macroeconomics ?
•
Data is aggregated to see the big picture rather than small economic units
• Role of money is of critical importance to
understanding macroeconomics
Macroeconomic Facts: The US
1-- Output and employment have been
steadily increasing throughout the history
Macroeconomic Facts: The US
2-- Unemployment Rate [The ratio of those
who are unemployed and are interested in
and are looking for gainful employment but
do not have jobs to total labor force] varies
for year to year. We are interested in
learning:
Macroeconomic Facts: The US
2-- Unemployment Rate [The ratio of those who are interested in gainful
employment but do not have jobs to total labor force] varies for year to year.
We are interested in leaning:
– what determines the long run output and
employment
Macroeconomic Facts: The US
•
Unemployment Rate [The ratio of those who are interested in gainful
employment but do not have jobs to total labor force] varies for year to year.
We are interested in leaning:
– what determines the long run output and employment
– what causes year to year fluctuations in
unemployment rates
Macroeconomic Facts: The US
3-- Money growth and Inflation seems to be
very closely move together, most of the
time.
Macroeconomic Facts: The US
4-- Balance of Trade [the difference between
exports and imports] has been negative and
rising. Does this mean that the rest of the
world is more competitive or it has
something to do with the US government
budget deficits? More discussion in chapter
5.
Macroeconomic Facts: The US
5-- Exchange Rates [value of one currency in
terms of another] have been widely
fluctuating. But an index of all exchange
rates show
Macroeconomic Facts: The US
5-- Exchange Rates [value of one currency in
terms of another] have been widely
fluctuating. But an index of all exchange
rates show
– a sharp rise in the first half of 1980s followed
Macroeconomic Facts: The US
5-- Exchange Rates [value of one currency in
terms of another] have been widely
fluctuating. But an index of all exchange
rates show
– a sharp rise in the first half of 1980s followed
– a sharp reversal in the rest of the period until
Macroeconomic Facts: The US
5-- Exchange Rates [value of one currency in
terms of another] have been widely
fluctuating. But an index of all exchange
rates show
– a sharp rise in the first half of 1980s followed
– a sharp reversal in the rest of the period until
– a rise in the mid 1990s again.
Key Economic Issues
1-- What factors influence long term growth
Key Economic Issues
1-- What factors influence long term growth
2-- Why output and employment deviate from
the long term trend
Key Economic Issues
1-- What factors influence long term growth
2-- Why output and employment deviate from the long term trend
3-- Role of money in affecting output, prices,
and employment
Key Economic Issues
1-- What factors influence long term growth
2-- Why output and employment deviate from the long term trend
3-- Role of money in affecting output, prices, and employment
4-- What are proper role of macro policy
Key Economic Issues
1-- What factors influence long term growth
2-- Why output and employment deviate from the long term trend
3-- Role of money in affecting output, prices, and employment
4-- What are proper role of macro policy
5-- The two way relationship between
interdependence (Globalization), trade and
exchange rates