The 3rd edition of Macroeconomics: Truths and Myths introduces macroeconomic concepts in a way that is engaging, while also tackling common misconceptions and myths held by society. Particular emphasis is given to policies which enhance long run economic growth and to exploring the tradeoffs between decisions making for the short term verses the long term. Macroeconomics: Truths and Myths enables students to understand economic phenomenon such as unemployment, inflation and business cycles while also learning about the institutions that impact economic policy. As the world economy is becoming increasingly interconnected, this book emphasizes how the presence of the international economy works to shape economic events and policies in the US. Students are presented with the basic theories behind fiscal and monetary policy, and how it is practiced by real life institutions and flawed institutional actors. Macroeconomics: Truths and Myths meets students where they are, explains the pros and cons of fiscal and monetary policy and allows students to add their own subjective criteria to determine for themselves what the ""best"" policies are.

Table of Contents:
Preface Chapter 1: Macroeconomics: An Overview Wealth Creation and Destruction Determining Which Economy Is ""Best"" Who Plans for Whom? What's Ahead Chapter 2: Production Measuring Production Imperfections with GDP International Comparisons of GDP Per Capita OpportUnity Cost Production Possibilities and Economic Growth Chapter 3: Specialization and Trade Why Trade? Trade's Wealth Creating Mathematical Certainty Trade Agreements The Balance of Trade Trade Barriers Arguments for Trade Restriction Chapter 4: Long Run Economic Growth Extensive Growth Extensive Growth Policies for Natural Resources The Importance of Property Right Protection Extensive Growth Policies for Labor Policies Influencing Family Size Changes in Immigration and Emigration Access to Healthcare Incarceration Rates Changes in Hours Worked and Labor Force Participation Extensive Growth Policies for Physical Capital Greater Accumulation of Physical Goods Property Rights Protection Rent Seeking Tax Incentives for Capital Accumulation Regulation and Infrastructure Savings Incentives Intensive Growth Incentives for Human Capital Accumulation Policies That Encourage the Creation of New Technology Policies That Encourage Entrepreneurship The Changing Mix of Output in the US Government Created Obstacles: Bailouts, Tax Codes, and Regulations Convergence Chapter 5: Unemployment Measuring Unemployment, Employment, and Labor Force Participation Who Is Most Likely to Experience Unemployment? Types of Unemployment Seasonal Unemployment Frictional Unemployment Structural Unemployment Cyclical Unemployment Full Employment Government Policies and Unemployment Chapter 6: Inflation Measuring Price Levels The Impact of Changing Prices Increased Consumer and Business Uncertainty Increased Search Costs Increased Advertising Costs People on Fixed Incomes and Those Holding onto Cash Lenders Bracket Creep and Capital Gains Taxes Deflation Problems with Inflation Measurements Causes of Inflation or Deflation Chapter 7: Business Cycles and Financial Institutions Macroeconomic Actors Consumers Financial Institutions Banks, Credit Unions, and Credit Card Companies Stock and Commodity Markets Bond Markets, Mutual Funds, and Pensions Firms The Government The Foreign Sector Business Cycles Case Study: The Great Recession (2007-2009) Investment and the Burst of the Housing Bubble Consumption and the fall of the Dow Net Exports and the Trade Deficit Conclusion Chapter 8: Aggregate Demand and Aggregate Supply Aggregate Demand Factors Which Shift Demand for Output Changes in Consumption Policies That Target Consumption Changes in Investment Policies That Target Investment Changes in Government Spending Policies That Target Government Spending Changes in Exports Policies That Target Net Exports Injections and Leakages Aggregate Supply Factors That Shift Aggregate Supply Macroeconomic Equilibrium Shifts Away from Full Employment Equilibrium Recessionary Gap Inflationary Gap Stagflation Long Run Economic Growth Say's Law The Self-Correcting Economy Self-Correction in a Recessionary Gap Self-Correction in an Inflationary Gap Self-Correction in Stagflation The Self-Correcting Economy in American History Chapter 9: Keynesian Fiscal Policy and Supply Side Economics Keynesian Fiscal Policy Expansionary Fiscal Policy Contractionary Fiscal Policy Fiscal Policy During Stagflation Automatic Stabilizers Supply Side Economics Deregulation Lower Taxes on Income Lowering Taxes on Savings Lower Capital Gains Taxes Lowering Corporate Income Tax Rates Issues With Supply Side Economics Conclusion Chapter 10: Government Spending and Taxing Government Spending Mandatory Spending Social Security and Medicare Discretionary Spending Taxes The Current Federal Tax Structure Cross Country Comparison of Tax Rates A Comparison of US State Tax Rates Tax Efficiency and Fairness Chapter 11: The National Debt The US National Debt The Burden of Government Debt Debt and Unfunded Liabilities for US States Unfunded Liabilities and National Governments Conclusion Chapter 12: Monetary Policy Money Three Functions of Money Commodity Money Fiat Money The Money Supply The Federal Reserve Functions of a Central Bank The History of Central Banking in the US The Structure of the Federal Reserve Monetary Policy An Economy Without a Central Bank What Is Monetary Policy and Why Is It Often Advocated? How Does the Federal Reserve Conduct Monetary Policy? 3 Tools of Monetary Policy Chapter 13: Problems with Fiscal and Monetary Policy Rent Seeking Time Lags Biases of Fiscal Policymakers Biases of Central Bankers Inefficiencies Created When Targeting Price Stability Liquidity Trap and Increased Volatility Rational Expectations Chapter 14: Exchange Rates How Much Is a Dollar Worth? Floating Exchange Rates Things That Cause the Demand for the US Dollar to Change Things That Cause the Supply of The US Dollar to Change Changes to the Value of a Currency Over Time Fixed Exchange Rates The European Union Chapter 15: Public Policy in a Global Economy Fiscal Policy Expansionary Fiscal Policy Contractionary Fiscal Policy Fiscal Policy in Stagflation Monetary Policy Expansionary Monetary Policy Contractionary Monetary Policy Self-Correction Foreign Economies' Impact on the Domestic Economy Barriers in the International Economy Public Policy Debates Fiscal Policy Rules vs. Discretion Monetary Policy Rules vs. Discretion Revisited: The Pros and Cons of Fiscal and Monetary Policy During a Recessionary Gap Revisited: The Pros and Cons of Fiscal and Monetary Policy During an Inflationary Gap Conclusion Glossary Index