Chapter 2 - Understanding economics and how it affects business. The goals of this chapter are: Explain basic economic, what capitalism is and how free markets work; analyze the trend toward mixed economies; describe the economic system of the ., including the significance of key economic indicators (especially GDP), productivity and the business cycle;. | Understanding Economics and How It Affects Business Chapter 02 McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. 1. Explain basic economic; what capitalism is and how free markets work. 2. Analyze the trend toward mixed economies. 3. Describe the economic system of the ., including the significance of key economic indicators (especially GDP), productivity and the business cycle. Contrast fiscal policy and monetary policy, and explain how each affects the economy. Contrast Caitalism, Socialism, Communisim and mixed markets. LEARNING GOALS Chapter Two 2- JOHN MAYNARD KEYNES Had great influence on . economic policy. Believed if the economy was in a recession, the government should increase spending and cut taxes to stimulate the economy for a short term. Profile Wrote The General Theory of Employment, Interest and Money in 1936. 2- What Is Economics? Economics -- The study of how society employs resources to produce goods | Understanding Economics and How It Affects Business Chapter 02 McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. 1. Explain basic economic; what capitalism is and how free markets work. 2. Analyze the trend toward mixed economies. 3. Describe the economic system of the ., including the significance of key economic indicators (especially GDP), productivity and the business cycle. Contrast fiscal policy and monetary policy, and explain how each affects the economy. Contrast Caitalism, Socialism, Communisim and mixed markets. LEARNING GOALS Chapter Two 2- JOHN MAYNARD KEYNES Had great influence on . economic policy. Believed if the economy was in a recession, the government should increase spending and cut taxes to stimulate the economy for a short term. Profile Wrote The General Theory of Employment, Interest and Money in 1936. 2- What Is Economics? Economics -- The study of how society employs resources to produce goods and services for consumption among various groups and individuals. Macroeconomics -- Concentrates on the operation of a nation’s economy as a whole. Microeconomics -- Concentrates on the behavior of people and organizations in markets for particular products or services. The MAJOR BRANCHES of ECONOMICS LG1 2- Resource Development -- The study of how to increase resources and create conditions that will make better use of them. What Is Economics? RESOURCE DEVELOPMENT LG1 2- New energy sources Hydrogen fuel New ways of growing foods Hydroponics New ways of creating goods and services Aquaculture Nanotechnology EXAMPLES of WAYS to INCREASE RESOURCES LG1 What Is Economics? 2- The Secret to Creating a Wealthy Economy Malthus believed that if the rich had most of the wealth and the poor had most of the population, resources would run out. This belief led the writer Thomas Carlyle to call economics “The Dismal Science.” Neo-Malthusians believe there are too many people in .
