Section 4: Money and Prices
Section 4: Money
and Prices
Macroeconomics is primarily concerned with how much an economy is producing (how many cars, handbags, computers), how many workers are being employed, how much investment in new capital and technology is taking place and what proportion of output is paid to workers and the owners of capital. As such, macroeconomics is not interested in money and prices alone but rather what monetary values and prices represent, the 'real economy'. However incorporating money and nominal prices into the model of economic fluctuations developed in the previous section can drastically impact the model’s predictions for the real economy. This section incorporates these phenomena, with particular focus on price inflation.
Lecture 16 - Money and the Price Level I
Lecture 17 - Money and the Price Level II