– Introduction: Basic Concepts of Macroeconomics: What is macroeconomics? How do we aggregate? Macroeconomic markets. Introduction to macroeconomic issues- Unemployment, Inflation, Foreign Debt, Exchange rates, Interest rates, Govt budget deficit., trade-offs and Tinbergen’s Rule.
– National Income Accounting: The circular flow of income and expenditure. Gross Domestic Product (GDP), different approaches to measure GDP, nominal versus real GDP, GDP deflator, GDP versus GNP, national income, personal income, personal disposable income, components of GDP, Consumer Price Index (CPI).
Aggregate Demand and Supply Analysis: Aggregate demand (AD), Aggregate Supply (AS), macroeconomic equilibrium, the impacts of changes in AD and AS on macroeconomic equilibrium.
-Classical theory: Say’s Law, Classical quantity theory as a theory of price level, and as a theory of aggregate demand, Classical theory of income and employment.
-Keynesian theory: Classical Vs Keynesian theory, simple model of determination of equilibrium income (the autarky economy without government), inventory investment, consumption and savings function, multiplier, paradox of thrift, effects of fiscal and monetary policies ( the autarky economy with govt.), balanced budget multiplier.
-The IS-LM Model: Equilibrium in the commodity market: the IS curve; equilibrium in the money market: the LM curve; derivation of the IS and LM curves, impacts of contractionary and expansionary monetary and fiscal policy on the IS and LM curve, crowding out effect, liquidity trap; derivation of aggregate demand curve and prices; aggregate supply.
-Consumption, Investment and the demand for money: Short run and long run consumption function (life cycle hypothesis, permanent income hypothesis, and relative income hypothesis), Theory of investment-NPV and MEI criteria, Demand for money-Liquidity preference theory.
– Extended Model of Income Determination (Flexible Price and Open Economy):Aggregate demand curve in an open economy, The open economy- Foreign exchange market; Balance of payments; IS-LM-BP model; fiscal and monetary policies under fixed and flexible exchange rate regimes assuming perfect mobility of capital.
-Inflation: Cost push and demand pull inflation, the Phillip’s curve and structural determinants of inflation; anticipated versus unanticipated inflation, the long run Phillip’s curve and the role of inflationary expectations- rational expectation versus adaptive expectation theory, costs of inflation, and current scenario of inflation in Bangladesh.
-Unemployment: Some definitions- labour force and participation rates, frictional, structural and natural unemployment, Beveridge Curve, Causes and types of unemployment; Efficiency wage theory; Insider-outsider theory; Implicit Contract Theory; Imperfect Information theory.
-Macroeconomics and Health

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