²Æ¾­»ù´¡Ó¢Óï

Unit 1 What Is Economics? 1.1 An Overview of Economics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­2 1.1.1 Branches of Economics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­2 1.1.2 Core Principles of Economics .¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­4 1.13 Types of Economic Systems¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­5 1.2 An Overview of Microeconomics ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­6 1.2.1 Key Concepts of Microeconomics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­..6 1.2.2 Core Theories of Microeconomics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­7 1.3 An Overview of Macroeconomics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­9 1.3.1 Key Concepts of Macroeconomics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­9 1.3.2 Core Theories of Macroeconomics ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­10 1.4 Positive Economics vs Normative Economics ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­1 1.4.1 Positive Economics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­11 1.4.2 Normative Economics¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­12 Unit 2 An Overview of Traditional Economic Thought in the West and China 2.1 An Overview of Traditional Economic Thought in the West¡­¡­18 2.1.1 Economic Thought in Ancient Greece and Rome¡­18 2.1.2 Economic Thought in the Middle Ages¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­19 2.2 An Overview of Traditional Economic Thought in China¡­¡­¡­¡­¡­2 2.2.1 Economic Thought Before the 6th Century¡­22 2.2.2 Economic Thought from the 7th to the 14th Century¡­¡­¡­¡­¡­¡­¡­¡­24 Unit 3 Demand and Supply 3.1 The Law of Demand and Supply¡­¡­30 3.1.1 Definition of Demand¡­30 3.1.2 Demand Curve¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­31 3.1.3 Definition of Supply¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­34 3.1.4 Supply Curve¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­35 3.2 Market Equilibrium¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.38 3.2.1 Equilibrium and Equilibrium Price ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­38 3.2.2 Change of Equilibiun ¡­40 3.3 Elasticity of Demand and Supply ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­41 3.3.1 The Elasticity of Demand ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­41 3.3.2 The Elasticity of Supply¡­43 Unit 4 Consumption and Production 4.1 Utility and Consumer Surplus¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­48 4.1.1 Total Utility and Marginal Utility¡­48 4.1.2 Consumer Surplus¡­49 4.2 Consumer Behavior Theories..¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­51 4.2.1 Consumer Equilibrium¡­51 4.2.2 Income Effect and Substitution Effect¡­53 4.3 Cost, Revenue and Profit¡­54 4.3.1 Cost and Producer Surplus.¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­54 4.3.2 Revenue and Profit¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­57 4.4 Producers and Production Theory¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­58 4.4.1 Producers and Production Functions¡­58 4.4.2 Productivity and Marginal Effects¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­59 Unit 5 Market Competition 5.1 Market and Market Structure¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­..66 5.2 Competition and Monopoly¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­67 5.2.1 Perfectly Competitive Market¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­67 5.2.2 Monopolistic Market ¡­71 5.3 Uncertainty and Game Theory¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­74 5.3.1 Uncertainty and Its Impact on the Market¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­74 5.3.2 Game Theory and the Prisoner's Dilemma¡­¡­¡­75 5.4 Market Failures and Public Goods¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­7 5.4.1 Pareto Efficiency and Market Failures¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­77 5.4.2 Externalities and Public Goods¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­78 Unit 6 Factor Market 6.1 Factor Market ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­86 6.1.1 Factors of Production and Factor Market¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­86 6.1.2 Perfectly Competitive and Imperfectly Competitive Factor Markets¡­88 6.2 Labor Market¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­89 6.2.1 Demand and Supply of Labor¡­89 6.2.2 The Price of Labor¡­92 6.3 Capital Market ..¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­94 63.1 Demand and Supply of Capital¡­94 6.3.2 The Price of Capital ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­95 6.4 Land Market¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.96 6.4.1 Features of Land ¡­96 6.4.2 The Price of Land ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­97 Unit 7 National Economy 7.1 GDP and GNP¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­102 7,1.1 Definitions of GDP and GNP..¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­102 7.1.2 Calculations of GDP and GNP¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­103 7.2 National Income ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­104 7.2.1 Calculation of National Income.¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­105 7.2.2 Distribution of National Income¡­¡­¡­105 7.2.3 Significance of National Income..¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­106 7.3 Aggregate Demand and Aggregate Supply¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­107 7.3.1 Aggregate Demand¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­107 7.3.2 Aggregate Supply .¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­109 7.3.3 The Aggregate Demand-Aggregate Supply Model¡­¡­¡­¡­¡­¡­¡­¡­¡­11 Unit 8 Economic Growth and the Business Cycle 8.1 Inflation¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­118 8.1.1 Inflation and Its Causes¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­118 8.1.2 Impacts of Inflation¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­120 8.2 Unemployment¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­121 8.2.1 Unemployment and Its Classification .¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­121 8.2.2 Impacts of Unemployment¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­122 8.3 Economic Growth¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­123 8.3.1 Significance of Economic Growth¡­123 8.3.2 Modem Economic Growth Theories.¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­124 8.4 The Business Cycle¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­126 8.4.1 The Business Cycle and Its Stages.¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­126 8.4.2 Causes of the Business Cycle¡­128 Unit 9 Macroeconomic Policy 9.1 The Role of Government in the Economy ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­134 9.1.1 Market Regulation.¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.134 9.1.2 Provision of Public Goods and Services ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.135 9.1.3 Economic Stabilization Through Macroeconomic Policies..137 9.2 Monetary Policy ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­138 9.2.1 Monetary Policy and Its Functions¡­¡­138 9.2.2 Clasification of Monetary Policy and Its Tools¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­139 9.2.3 Challenges of Monetary Policy¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­..141 9.3 Fiscal Policy ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­142 9.3.1 Fiscal Policy and Its Functions¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.143 9.3.2 Classification of Fiscal Policy and Its Tools..¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­144 9.3.3 Challenges of Fiscal Policy ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­145 Unit 10 International Economy 10.1 Absolute Advantage and Comparative Advantage¡­152 10.1.1 Absolute Advantage¡­¡­152 10.1.2 Comparative Advantage¡­¡­153 10.13 Comparative Advantage and International Trade¡­154 10.2 International Economy and Globalization ¡­¡­155 10.2.1 Economic Interdependence¡­¡­155 10.2.2 Evolution of Globalization ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­156 10.3 Tariffs¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­158 10.3.1 Definition of Tariff¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­158 10.3.2 The Economic Effects of Tariffs¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.159 10.3.3 The Welfare Effects of Tariffs ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­160 Unit 11 Money and Interest Rates¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­165 11.1 Money ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.166 11.1.1 Definition of Money .¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­166 11.1.2 Origins of Money¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.167 11.1.3 Function and Nature of Money¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­168 11.1.4 The Monetary System¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­170 11.2 Interest Rates¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­171 11.2.1 Definition of Interest Rates¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­171 11.2.2 Types of Interest Rates and Influential Factors¡­¡­¡­¡­¡­¡­¡­.172 Unit 12 Financial Institutions and Financial Markets 12.1 Financial Institutions ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­180 12.1.1 Banking Institutions.¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­180 12.1.2 Non-banking Financial Institutions¡­184 12.2 Financial Markets ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­186 12.2.1 Money Markets and Capital Markets ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.186 12.2.2 Primary Markets and Secondary Markets .¡­¡­¡­¡­¡­¡­¡­¡­.187 Unit 13 International Payments 13.1 Foreign Exchange and Exchange Rate¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.194 13.1.1 Foreign Exchange¡­194 13.1.2 Exchange Rate¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­195 13.2 International Balance of Payments ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­199 13.2.1 Definition of International Balance of Payments¡­¡­¡­¡­¡­¡­¡­¡­?99 13.2.2 Imbalance of International Payments ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.200 13.2.3 Adjustment of the Imbalance of Payments¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­202 Unit 14 Financial Risk, Crisis, and Supervision¡­¡­¡­¡­¡­¡­207 14.1 Financial Risk¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­208 14.1.1 Overview of Financial Risk¡­208 14.1.2 Management of Financial Risk ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­..210 14.2 Financial Crisis¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­211 14.2.1 Overview of Financial Crisis¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.211 14.2.2 Impacts of Financial Crisis¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­213 14.3 Financial Supervision ¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­215 14.3.1 Definition of Financial Supervision.¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­215 14.3.2 Financial Regulation System¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­216 References¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­221 Glossary¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­225 Terms¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­241