 |  Macroeconomics, 6/e Rudi Dornbusch,
Massachusetts Institute of Technology
Stanley Fischer,
International Monetary Fund, on leave from MIT
Richard Startz,
University of Washington
Frank Atkins,
University of Calgary
Gordon Sparks,
Queen's University
Introduction
Chapter ObjectivesAfter reading and studying this chapter, you should be able to:
| Understand how economists use models, and how price in a market plays an important role of ensuring market equilibrium. |
| | | | Understand how price movement in some markets may be assumed to be slow or even fixed, and how macroeconomics uses these fixed and flexible price assumptions. |
| | | | Identify three different time frames for analysis — the very long run, the long run, and the short run — and understand how these time frames are tied to the fixed and flexible price assumptions, and to assumptions concerning factors of production. |
| | | | Understand how actual macroeconomic data are consistent with the assumptions that underlie these time frames. |
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2002 McGraw-Hill Higher Education