Macroeconomics in business 2600-DSMz1MAB

Topics covered during the lecture:
1. The world of macroeconomic phenomena
1.1. An enterprise in a macroeconomic environment
1.2. Economic situation, crises and economic growth
1.3. Inflation and unemployment
1.4. Macroeconomic theories and models
1.5. Short, medium and long term in macroeconomic analysis
1.6. Closed and open economy
1.7. Macroeconomic policy
2. The subject of macroeconomics in business 2.1. Macroeconomics is the study of the economy
2.2. Gross Domestic Product as a measure of economic activity
2.3. Nominal and real GDP, GDP deflator
2.4. Circular movement model (total production, income and expenditure)
2.5. Macroeconomic dependencies
2.6. System of National Accounts (GNP at market prices, GDP at market prices, GDP as total expenditure, national income and other measures)
3. Production and total demand - goods market
3.1. Factors determining the volume of production in the short term
3.2. Aggregate Demand Analysis
3.3. Equilibrium in the goods market
3.4. Graphical model of equilibrium of production and aggregate demand (Keynesian model)
3.5. Changes in production volume depend on changes in autonomous demand
3.6. Multiplier effect analysis
3.7. The importance of government spending
3.8. Fiscal policy
4. Money and financial markets
4.1. Money - functions and types
4.2. Money demand function (liquidity preference, income volume)
4.3. Money supply and interest rate
4.4. Central bank and monetary policy
4.5. Open market operations and their effects
5. Money and financial markets II
5.1. Banks and financial intermediation
5.2. How do banks create money?
5.3. Money supply model and money creation multiplier
5.4. Monetary policy – reserve requirement rate and discount rate
5.5. Effectiveness of money supply control
5.6. Monetary policy transmission mechanism
6. The Goods and money markets - IS-LM model 6.1. The impact of money and interest rates on the volume of production and income
6.2. Consumption and investment and the interest rate
6.3. Derivation of the IS-LM model
6.4. Monetary and fiscal policy and the volume of production and income
6.5. Shocks in the IS-LM model
6.6. Stabilization of production and income at the potential level
7. Production and price level - AD-AS model
7.1. Production volume and price level changes 7.2. Aggregate demand function – AD
7.3. The impact of monetary and fiscal policy on aggregate demand
7.4. Total supply function - AS
7.5. Aggregate supply curve – SRAS and LRAS 7.6. Classic dichotomy - money neutrality in the long term
7.7. Long-run equilibrium in the AD-AS model
7.8. Demand and supply shocks and stabilization policy
8. AD – AS model – extension
8.1. Stagflation in the interpretation of the AD–AS model
8.2. Total supply function in the short and long run 8.3. "Frictions" and deviations of production from the natural level
8.4. Models explaining "frictions"
8.5. Expectations and imperfect information
8.6. Demand shock and long-term adjustments
8.7. The problem of money neutrality
9. Unemployment and inflation - Philips curve
9.1. Labor market and unemployment
9.2. Theories of unemployment
9.3. Natural unemployment rate
9.4. Social costs of unemployment
9.5. Inflation
9.6. Inflation and interest rate - Fisher's equation 9.7. Social costs of inflation
9.8. Derivation of the Philips curve
9.9. The Phillips curve and economic policy
9.10. Short-run and long-run Philips curve
10. The economic crisis caused by the pandemic and contemporary inflation
10.1. The nature of the current crisis
10.2. Two shocks and a stabilization policy
10.3. The current crisis in the interpretation of the AD-AS model
10.4. Financial policy
10.5. Unconventional monetary policy
10.6. Health and the economic crisis
11. Problems of economic growth
11.1. Why are some countries rich and others poor?
11.2. Factors of economic growth
11.3. Motivations and incentives to work
11.4. Institutions, culture, religion
11.5. Introduction to the Solow model
11.6. The theory of endogenous growth, the process of creative destruction…
12. Dilemmas of macroeconomic policy
12.1. Should macroeconomic policy be active or passive?
12.2. Should policy be discretionary or rule-based?
12.3. Politics in a world of uncertainty and crises
12.4. Government debt and budget deficit

The thematic scope of the exercises includes (minimum scope):
1. Basic concepts of macroeconomics
 Outlining the macroeconomic perspective
 Definition of macroeconomics
 Macroeconomic dependencies
 Introduction of differentiation between nominal and real values
 Enterprise and business decisions, including financial ones, in the macroeconomic environment
2. National income account
 Macroeconomic measures
 Methods of measuring GDP
 Other measures of national income
 Meaning and interpretation of economic data regarding national accounts
3. Circular motion model
 Classification of the main macroeconomic sectors of the economy
 Circular movement of products and money in a closed economy
 Circular movement of products and money in an open economy
4. Changes in the price level in the economy
 Inflation – definition and types
 inflation measurement (CPI, PPI, HICP)
 Business and financial decisions in conditions of inflation (debt inflation effect)
 Costs and consequences of inflation.
 Deflation and its types
 Business and financial decisions in deflation conditions (debt deflation effect)
5. Labor market
 Basic concepts of the labor market and macroeconomic indicators
 Demand and supply in the labor market
 Short- and long-term balance in the labor market
 Definition of economic and registered unemployment
 Economic classification of unemployment
 Effects of unemployment
 Unemployment and inflation – the Phillips curve
 Okun's Law
6. Economic growth
 Growth and economic development
 Measurement of economic growth and development
 Growth factors and economic development factors
 Technological factor in economic development
 Solow-Swan model of economic growth
 knowledge and institutions in economic development
7. The business cycle in the economy
 Definition and stages of the business cycle
 Business cycle models
 Assessment of the economic environment and business decisions using the business cycle (leading indicators)
 Business cycle and capital market cycle
8. Keynes' model - global demand
 Consumption function (AD) and saving function (AS)
 Investment demand
 State of short-term equilibrium
 The impact of investments on the equilibrium level
 The paradox of thrift
 Global demand, its components and importance in the economy - impact on the decisions of economic entities
9. The role of the state in the economy - fiscal policy
 The state and global demand.
 Instruments of the state's economic policy
 Budget and budget deficit
 Public debt
 Fiscal policy and its types
 The influence of the state on the decisions of economic entities, including financial ones
 Maastricht criteria
10. Foreign trade and its impact on the macroeconomic environment
 Aggregate demand in an open economy
 Effectiveness of fiscal policy in the modern economy
11. Money and the bank
 Money, its functions and importance
 Cost of money – interest rate
 Banks and the banking system
 Central bank – its functions in the economy
 Monetary policy
12. Policy mix – IS-LM model
 Demand for money
 Equilibrium in the money market
 Coordination of monetary and fiscal policy
 Policy mix and the business cycle
13. Global, supply prices and macroeconomic adjustments
 Global supply
 Macroeconomic demand curve
 Credit channel in the economy
 Potential production
 Wage adjustments
14. Dilemmas of macroeconomic policy