9780073542850

Principles of Economics, 3rd Edition, by Jeff Holt is a clear, concise, and economical alternative to the typical textbook. This text includes a built-in study guide that enables students to reinforce concepts and better comprehend the material. The book is spiral bound which allows it to lay flat when open, making it easier for students to work the problems in the study guide. Supplemental materials available for adopting instructors include an Instructor's Manual, Test Bank, and Power Point slides--all prepared by the author.

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Introduction: A Brief History of U.S. Economic Growth
1. From Jamestown to the Present
2. Increases in Per Capita Output
3. Improvements in the Standard of Living
4. Thirty Largest National Economies
5. Questions for Introduction
6. Answers for Introduction
Chapter 1: Scarcity and Choices
1. The Basic Economic Problem - Scarcity
2. Human Wants Are Unlimited
3. Resources Are Limited
4. Categories of Resources
5. Resource Owner Motivation
6. Opportunity Cost
7. Rationing
8. Marginal Benefits and Marginal Costs
9. Scientific Thinking
10. Macroeconomics versus Microeconomics
11. Appendix: Graphs
12. Direct Relationship
13. Inverse Relationship
14. Slope
15. Questions for Chapter 1
16. Answers for Chapter 1
Chapter 2: Trade and Economic Systems
1. Self-sufficiency or Trade
2. Consumers Surplus and Producers Surplus
3. Externalities
4. The Production Possibilities Frontier
5. Law of Increasing Opportunity Cost
6. Economic Efficiency
7. Economic Growth
8. Economic Systems
9. Capitalist Vision
10. Socialist Vision
11. Three Economic Questions
12. Appendix: A Movement Along a Curve versus a Shift in a Curve
13. Questions for Chapter 2
14. Answers for Chapter 2
Chapter 3: Demand, Supply, and Equilibrium
1. Demand
2. Law of Demand
3. Substitution Effect
4. Income Effect
5. Demand Schedule and Demand Curve
6. Determinants of Demand
7. Change in Demand versus Change in Quantity Demanded
8. Supply
9. Law of Supply
10. Determinant of Supply
11. Change in Supply versus Change in Quantity Supplied
12. Equilibrium: Putting Demand and Supply Together
13. Moving from Disequilibrium to Equilibrium
14. Free Markets and Economic Efficiency I
15. Free Markets and Economic Efficiency II
16. A Change in Equilibrium Price and Quantity
17. Price Controls
18. A Price Ceiling
19. A Price Floor
20. Price Controls and Economic Inefficiency
21. Questions for Chapter 3
22. Answers for Chapter 3
Chapter 4: Inflation and Unemployment
1. Three Macroeconomic Goals
2. Inflation
3. The Price Level, Money, and Production
4. Consumer Price Index
5. Computing the Rate of Inflation
6. Consumer Price Index Table
7. Adjusting Nominal Values to Real Values
8. Unemployment
9. Full Employment
10. Measuring Unemployment
11. Types of Unemployment
12. Frictional Unemployment
13. Structural Unemployment
14. Natural Unemployment Rate
15. Cyclical Unemployment
16. Appendix: Economic Growth and Job Destruction
17. Appendix: Female Labor Force Participation
18. Questions for Chapter 4
19. Answers for Chapter 4
Chapter 5: Measuring Total Output: GDP
1. Gross Domestic Product
2. Exclusions From GDP
3. Two Measures of Total Output
4. Per Capita Output
5. Per Capita Personal Income - 2004
6. Real GDP
7. Historical Data on Nominal and Real GDP
8. The Business Cycle
9. Appendix: The Three Economic Goals and the U.S. Economy
10. Appendix: Circular Flow Diagram
11. Questions for Chapter 5
12. Answers for Chapter 5
Chapter 6: The Aggregate Market
1. Aggregate Demand
2. Shifts in the Aggregate Demand Curve
3. Aggregate Supply
4. Shifts in the SRAS Curve
5. Short-Run Equilibrium: Putting AD and SRAS Together
6. Changes in AD and SRAS
7. Appendix: Why the Aggregate Demand Curve Slopes Downward
8. Appendix: Why the Short-Run Aggregate Supply Curve Slopes Upward
9. Questions for Chapter 6
10. Answers for Chapter 6
Chapter 7: Classical Economic Theory
1. Adam Smith
2. The Ideal Quantity of Total Output
3. The Self-Regulating Economy
4. Marxs Criticism of Classical Theory
5. Says Law
6. Says Law, Savings, and Flexible Interest Rates
7. Says Law and Flexible Wages and Prices
8. Natural Real GDP
9. A Recessionary Gap
10. An Inflationary Gap
11. Long-Run Equilibrium
12. Automatically Closing a Recessionary Gap
13. Automatically Closing an Inflationary Gap
14. Long-Run Aggregate Supply
15. Laissez-faire
16. Questions for Chapter 7
17. Answers for Chapter 7
Chapter 8: Keynesian Economic Theory
1. John Maynard Keynes
2. Keynesian Theory and Says Law
3. Keynesian Theory and Closing a Recessionary Gap
4. Consumption
5. Marginal Propensity to Consume
6. The 45 Angle Line
7. The Total Expenditures Curve
8. Equilibrium Real GDP
9. Equilibrium Real GDP and the 45 Angle Line
10. A Change in Total Expenditures
11. Formula for Change in Real GDP
12. The Multiplier
13. Questions for Chapter 8
14. Answers for Chapter 8
Chapter 9: Fiscal Policy
1. Keynesian Fiscal Policy
2. Keynesian Fiscal Policy Theory and a Recessionary Gap
3. Keynesian Fiscal Policy Theory and an Inflationary Gap
4. Automatic Stabilizers
5. Potential Problems with Fiscal Policy
6. Supply-side Fiscal Policy
7. The Laffer Curve
8. Supply-side Tax Cuts
9. Appendix: History of the Federal Governments Budget
10. Questions for Chapter 9
11. Answers for Chapter 9
Chapter 10: Money and Money Creation
1. Money
2. Barter
3. Functions of Money
4. Why Money is Valuable
5. Measuring the Money Supply
6. Checks and Credit Cards
7. Money Creation
8. Required Reserves
9. Reserves
10. Excess Reserves
11. A Simplified Balance Sheet
12. U.S. Government Securities
13. Potential Deposit Multiplier
14. Questions for Chapter 10
15. Answers for Chapter 10
Chapter 11: The Federal Reserve System and Inflation
1. The U.S. Central Bank
2. Functions of the Federal Reserve System
3. Monetary Base and the Money Supply
4. The Actual Money Multiplier
5. Tools for Controlling the Money Supply
6. Open Market Operations
7. Changing the Reserve Requirement
8. Changing the Discount Rate
9. Inflation
10. Effects of Inflation
11. Appendix: The Independence of the Federal Reserve System
12. Appendix: Recent Fed Monetary Policy
13. Questions for Chapter 11
14. Answers for Chapter 11
Chapter 12: Monetary Policy
1. Classical Monetary Theory
2. Velocity of Money
3. Monetarism
4. Keynesian Monetary Theory
5. Failure of the Keynesian Monetary Transmission Mechanism
6. Monetarist Transmission Mechanism
7. Monetary Policy and Closing Gaps
8. Keynesian Theory and the Proper Policies
9. Monetarist Theory and the Proper Policies
10. Appendix: The Great Depression
11. Keynesian Theory of the Great Depression
12. Classical Theory of the Great Depression
13. Questions for Chapter 12
14. Answers for Chapter 12
Chapter 13: Taxes, Deficits, and the National Debt
1. Classifications of Taxes
2. Major Federal Taxes
3. History of the Federal Personal Income Tax
4. Characteristics of a Good Tax
5. Excess Burden
6. Is the Federal Personal Income Tax a Good Tax?
7. What Would Make the Federal Personal Income Tax a Better Tax?
8. The Burden of the Federal Personal Income Tax
9. Major Federal Spending Programs
10. Deficits and the National Debt
11. The Burden of Deficit Spending
12. Questions for Chapter 13
13. Answers for Chapter 13
Chapter 14: Economic Growth
1. Absolute Economic Growth
2. Per Capita Economic Growth
3. Economic Growth in the U.S.
4. Determinants of Economic Growth
5. Governmental Policies and Economic Growth
6. Industrial Policy
7. Theories of Economic Growth
8. Classical Growth Theory
9. Neoclassical Growth Theory
10. New Growth Theory
11. Appendix: New Ideas and Central Planning
12. Appendix: Worries about Future Economic Growth
13. Questions for Chapter 14
14. Answers for Chapter 14
Chapter 15: Less Developed Countries
1. Developed Countries versus Less Developed Countries
2. Common Hardships for LDCs
3. Economic Growth and the Rule of 70
4. The Importance of Economic Growth Rates
5. Economic Freedom and Economic Growth
6. Obstacles to Economic Development
7. Counterproductive Governmental Policies
8. Appendix: Per Capita GDP for Selected Countries
9. Appendix: The Power of Productivity
10. Questions for Chapter 15
11. Answers for Chapter 15
Chapter 16: International Trade
1. Some International Trade Facts
2. Why Nations Trade
3. Comparative Advantage Example
4. Trade Restrictions
5. The Effects of a Quota of Zero
6. Gain to Domestic Producers
7. Loss to Domestic Consumers
8. The Politics of Trade Restrictions
9. Arguments for Trade Restrictions
10. The Movement toward Freer Trade
11. Appendix: Comparative Advantage versus Absolute Advantage
12. Appendix: Exchange Rates
13. Questions for Chapter 16
14. Answers for Chapter 16
Chapter 17: Elasticity
1. Elasticity
2. Price Elasticity of Demand
3. Two Extreme Examples
4. Computing Price Elasticity of Demand
5. Price Elasticity of Demand Classifications
6. Price Elasticity of Demand and Total Revenue
7. Determinants of Price Elasticity of Demand
8. Income Elasticity of Demand
9. Normal Goods and Inferior Goods
10. Cross Elasticity of Demand
11. Substitutes and Complements
12. Price Elasticity of Supply
13. The Burden of a Tax and Price Elasticity
14. Questions for Chapter 17
15. Answers for Chapter 17
Chapter 18: Utility
1. Utility
2. Utility is a Subjective Measurement
3. Marginal Utility
4. Law of Diminishing Marginal Utility
5. Diminishing Marginal Utility and Income Distribution
6. Diamond-Water Paradox
7. Utility Maximization
8. Utility Maximization Rules
9. Providing Essential Goods Free of Charge
10. Efficiency: Equating Marginal Benefit and Marginal Cost
11. Appendix: Consumer Behavior, Indifference Curves and Budget Constraints
12. Questions for Chapter 18
13. Answers for Chapter 18
Chapter 19: The Firm
1. Firms and Efficiency
2. Firms and Reduced Transaction Costs
3. Firms and Team Production
4. Shirking in Team Production
5. The Principal-Agent Problem
6. Business Firms
7. The Chief Goal of Business Firms
8. Legal Types of Business Firms
9. Financing Business Activity
10. The Balance Sheet of a Business Firm
11. Nonprofit Firms
12. Questions for Chapter 19
13. Answers for Chapter 19
Chapter 20: Production and Costs
1. Explicit Costs versus Implicit Costs
2. Accounting Profit versus Economic Profit
3. Sunk Cost
4. Short Run Production versus Long Run Production
5. Marginal Physical Product
6. Law of Diminishing Marginal Returns
7. Diminishing Marginal Returns and Marginal Cost
8. Fixed Costs versus Variable Costs
9. Total Cost
10. Average Costs of Production
11. Cost Curves Graph
12. Appendix: Total Revenue, Total Cost, and Break-Even
13. Questions for Chapter 20
14. Answers for Chapter 20
Chapter 21: Perfect Competition
1. Market Structure and Market Power
2. The Key Characteristic of Perfect Competition
3. The Demand Curve for a Perfect Competitor
4. Profit-Maximization
5. Shutdown Point
6. The Supply Curve for a Perfect Competitor
7. Perfect Competition in the Long Run
8. Perfect Competition and Economic Efficiency
9. Perfect Competitions Happy Coincidence
10. Perfect Competition and Individual Freedom
11. Appendix: Economic Profit and Loss
12. Appendix: Perfect Competition in the Long Run
13. Questions for Chapter 21
14. Answers for Chapter 21
Chapter 22: Monopoly
1. Monopoly and Market Power
2. Monopoly and Barriers to Entry
3. Demand and Marginal Revenue for a Monopoly
4. Demand Curve and MR Curve for a Monopoly
5. Profit-Maximization
6. Comparing Monopoly to Perfect Competition
7. The Economic Inefficiency of Monopoly
8. Rent Seeking
9. Other Problems with Monopoly
10. Price Discrimination
11. Appendix: Comparing Monopoly to Perfect Competition; Profit
12. Questions for Chapter 22
13. Answers for Chapter 22
Chapter 23: Monopolistic Competition and Oligopoly
1. Monopolistic Competition
2. Product Differentiation
3. Demand and Marginal Revenue for a Monopolistic Competitor
4. Profit-Maximization for a Monopolistic Competitor
5. Comparing Monopolistic Competition to Perfect Competition
6. The Economic Inefficiency of Monopolistic Competition
7. Monopolistic Competition and Profits in the Long Run
8. Oligopoly
9. Theories of Oligopoly Behavior
10. The Economic Inefficiency of Oligopoly
11. Appendix: Game theory
12. Questions for Chapter 23
13. Answers for Chapter 23
Chapter 24: Factor Markets
1. Demand for a Factor
2. Marginal Revenue Product
3. Marginal Factor Cost
4. Profit-Maximization Rule for Employing Factors
5. Demand Curve for a Factor
6. Determinants of Factor Demand
7. Value of the Marginal Product
8. Cost-Minimizing Combination of Factors
9. Elasticity of Demand for Labor
10. Labor Supply Curve for a Perfectly Competitive Employer
11. Labor Supply Curve in a Particular Labor Market
12. Determinants of Labor Supply
13. Differences in Wage Rates
14. Screening Devices
15. Questions for Chapter 24
16. Answers for Chapter 24
Chapter 25: Labor Unions
1. Types of Labor Unions
2. Demand Curve for a Union
3. Union Goals
4. Right-to-work Laws
5. Collective Bargaining
6. Monopsony
7. Profit-Maximization for a Monopsony
8. The Union and the Monopsony
9. Unions and Wages
10. Unions and Productivity
11 Questions for Chapter 25
12. Answers for Chapter 25
Chapter 26: Interest, Present Value, Rent, and Profit
1. The Loanable Funds Market
2. Supply of Loanable Funds
3. Private Demand for Loanable Funds
4. Changes in the Demand for Loanable Funds
5. Interest Rates Vary
6. Real Interest Rate
7. Present Value
8. Economic Rent
9. Economic Profit
10. Profit as a Signal
11. Appendix: Present Value Table
12. Questions for Chapter 26
13. Answers for Chapter 26
Chapter 27: Market Failure
1. Economic Efficiency Rule
2. Externalities
3. Private Market Equilibrium
4. External Benefit
5. External Cost
6. Controlling Externalities
7. Internalizing Externalities
8. Government Regulation of Externalities
9. Pollution Control
10. Public Goods
11. Other Causes of Market Failure
12. Questions for Chapter 27
13. Answers for Chapter 27
Chapter 28: Public Choice and Government Failure
1. Government Failure
2. Voters
3. Low Voter Turnover
4. Rational Ignorance
5. Candidates and the Median Voter Model
6. Elected Officials
7. Elected Officials and Short Run Focus
8. Elected Officials and Special-Interest Groups
9. The Influence of Special-Interest Groups
10. A Congressional District as a Special-Interest Group
11. Government Bureaus
12. Other Sources of Government Failure
13. Questions for Chapter 28
14. Answers for Chapter 28
Chapter 29: Government Regulation of Business
1. Attributes of Private Markets
2. Government Regulation of Natural Monopoly
3. Deadweight Loss of Unregulated Natural Monopoly
4. Problems with Regulating Natural Monopoly
5. Public Interest Theory of Regulation
6. Capture Theory of Regulation
7. Public Choice Theory of Regulation
8. Costs of Regulations
9. Deregulation
10. Appendix: Antitrust Law
11. Questions for Chapter 29
12. Answers for Chapter 29
Chapter 30: Agriculture
1. Resources Devoted to Agriculture
2. Good News about U.S. Agriculture
3. The Long Run Problem for Farmers
4. The Short Run Problem for Farmers
5. Traditional Farm Policies
6. The FAIR Act of 1996
7. The Farm Security and Rural Investment Act of 2002
8. Appendix: Some Comments on the Governments Agricultural Policies
9. Questions for Chapter 30
10. Answers for Chapter 30
Chapter 31: The Distribution of Income and Poverty
1. Some Income Distribution Facts
2. Economic Mobility
3. The Lorenz Curve
4. Overstating the Degree of Income Inequality
5. Distribution of Wealth
6. Overstating the Inequality in Wealth Distribution
7. Causes of Continuing Income Inequality
8. Standards of Income Distribution
9. Income Redistribution
10. Ideal Income Redistribution
11. Actual Income Redistribution
12. Negative Income Tax
13. Poverty
14. Poverty and Economic Mobility
15. Appendix: Four Keys to Achieving Financial Security
16. Questions for Chapter 31
17. Answers for Chapter 31

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Principles of Economics

Principles of Economics

0073542857

Summary

Table of Contents

1. From Jamestown to the Present

2. Increases in Per Capita Output

3. Improvements in the Standard of Living

4. Thirty Largest National Economies

5. Questions for Introduction

6. Answers for Introduction

Chapter 1: Scarcity and Choices

1. The Basic Economic Problem - Scarcity

2. Human Wants Are Unlimited

3. Resources Are Limited

4. Categories of Resources

5. Resource Owner Motivation

6. Opportunity Cost

7. Rationing

8. Marginal Benefits and Marginal Costs

9. Scientific Thinking

10. Macroeconomics versus Microeconomics

11. Appendix: Graphs

12. Direct Relationship

13. Inverse Relationship

14. Slope

15. Questions for Chapter 1

16. Answers for Chapter 1

Chapter 2: Trade and Economic Systems

1. Self-sufficiency or Trade

2. Consumers Surplus and Producers Surplus

3. Externalities

4. The Production Possibilities Frontier

5. Law of Increasing Opportunity Cost

6. Economic Efficiency

7. Economic Growth

8. Economic Systems

9. Capitalist Vision

10. Socialist Vision

11. Three Economic Questions

12. Appendix: A Movement Along a Curve versus a Shift in a Curve

13. Questions for Chapter 2

14. Answers for Chapter 2

Chapter 3: Demand, Supply, and Equilibrium

1. Demand

2. Law of Demand

3. Substitution Effect

4. Income Effect

5. Demand Schedule and Demand Curve

6. Determinants of Demand

7. Change in Demand versus Change in Quantity Demanded

8. Supply

9. Law of Supply

10. Determinant of Supply

11. Change in Supply versus Change in Quantity Supplied

12. Equilibrium: Putting Demand and Supply Together

13. Moving from Disequilibrium to Equilibrium

14. Free Markets and Economic Efficiency I

15. Free Markets and Economic Efficiency II

16. A Change in Equilibrium Price and Quantity

17. Price Controls

18. A Price Ceiling

19. A Price Floor

20. Price Controls and Economic Inefficiency

21. Questions for Chapter 3

22. Answers for Chapter 3

Chapter 4: Inflation and Unemployment

1. Three Macroeconomic Goals

2. Inflation

3. The Price Level, Money, and Production

4. Consumer Price Index

5. Computing the Rate of Inflation

6. Consumer Price Index Table

7. Adjusting Nominal Values to Real Values

8. Unemployment

9. Full Employment

10. Measuring Unemployment

11. Types of Unemployment