Chapter 8

Macroeconomics

 The study on how we can

best increase our
country’s wealth given
the available resources
that we have
Role of Government
Government
spending

Taxation

Regulation

Monetary
policies
Production Possibilities Frontier

 Represents outcome
or production
combination that can
be produced with a
given amount of
resources
Production Possibilities Curve
Reasons for economic growth

Increase in
capital stock

Advances in
technology
Circular Flow Model
Important concepts and definitions

• Refers to peso
Nominal
values or
Values absolute values

• Refers to values in
comparison, or
Real
relative, to other
Values
related economic
variables
Important concepts and definitions
• Facts or
relationships
Positive
that can be
Economics proven or
disproven

• Someone’s
opinion or
Normative
value judgment
Economics
about an
economic issue