There are no prerequisites.

Course Description

Understanding the economy and coping with economic changes is critical in today's business environment and a major concern for managers and investors. This course addresses macroeconomic factors that may affect business performance, including business cycles, interest rates, economic policy, inflation, unemployment, housing starts, money supply, and foreign exchange rates. The ways the Fed's monetary policy affects corporate earnings are stressed, and a variety of economic statistics and indicators are explored.


Delta Publishing

For many years, Delta Publishing has offered a wide variety of continuing education courses for financial professionals. Topics covered by Delta’s courses include accounting, financial management, budgeting, investments, financial statement reporting, business management, IFRS, ethics, valuations, real estate, and business writing. The diversity and breadth of Delta’s course offerings make the company a prolific and unique contributor to the CPE world. Delta’s well-credentialed authors and contributors have also been published in numerous academic and professional journals and quoted by some of the leading financial media outlets.

Course Specifics

Aug 3, 2017
There are no prerequisites.

Compliance Information

Qualifies for CA Fraud: No

Learning Objectives

Upon successful completion of this course, participants will be able to:

Chapter 1

  • Identify economic trends and direction, sources of economic data, investment decisions, and current federal economic indicators.

Chapter 2

  • Identify the scope, objectives, systems, theories, models, and policies of economics.
  • Differentiate between microeconomics and macroeconomics.
  • Differentiate between the public and private sectors of the economy.

Chapter 3

  • Identify the relationships of economic variables in mathematical and graphical terms.

Chapter 4

  • Cite important aspects of fundamental macroeconomic concepts including uses of money, the circular flow of income, inflation, deflation, and relating prices to resource allocation.
  • Identify the impact of unemployment and full-employment on the economy.

Chapter 5

  • Identify how to measure economic activity through the gross domestic product (GDP), inflation, money supply, unemployment, and other national income measures.
  • Distinguish between real and nominal measures.
  • Identify index number problems.

Chapter 6

  • Distinguish between consumption and marginal propensity to consume.
  • Define the components of investment.
  • Differentiate between saving and investment.

Chapter 7

  • Identify the fiscal policy program's role in taxation, the consumption function, government spending, and budget deficits.
  • Cite important aspects of the expenditure multiplier, the tax multiplier, and the balanced budget multiplier.

Chapter 8

  • Define the function of money.
  • Identify the role of financial instruments.
  • Differentiate between interest and interest rates.

Chapter 9

  • Identify the effects of price level and inflation, income and interest rates, investment and interest rates, the quantity theory of money, and supply of and demand for money.

Chapter 10

  • Identify the important concepts of aggregate supply and demand.
  • Identify the roles of labor supply, wages, and productivity.
  • Identify the various approaches to reduce federal deficits.

Chapter 11

  • Identify the impact of international trade and finance.
  • Identify the effects of a strong and weak dollar on the economy.

Chapter 12

  • Identify the macroeconomic effects of the classical (market clearing) model, Keynesianism, monetarism, neoclassical macroeconomics, rational expectations, and supply side economics.

Table of Contents

Chapter 1 – Understanding Economic Data and Indicators

Learning Objectives

Economic Indicators and Stocks and Businesses

Economic Indicators and Bond Yields

Economic Indicator: Index of Leading Indicators

Coincident indicators

Lagging indicators

Economic Indicators: Consumers Confidence Indices

The NAHB-Wells Fargo Housing Opportunity Index (HOI)

S&P/Case-Shiller Home Price Indices

Chapter 1 Review Questions

Chapter 2 – The Scope of Economics

Learning Objectives

Individual Keys in This Chapter

Key 1—The Objectives of Economics


The Scope of Economics

Economic Resources

Key 2—Microeconomics vs. Macroeconomics


Microeconomics vs. Macroeconomics

Key 3—The Private and Public Sectors


The Private Sector

The Public Sector

Key 4—Economic Systems


Economic Systems

Key 5—Economic Theories and Models


Economic Theories

Economic Models

Key 6—Economic Policy


Two Broad Classes of Economic Policy

Economic Policy and Stabilization Policy

Major Goals of Economic Policy in the United States

Chapter 2 Review Questions

Chapter 3 – Basic Concepts in Economics

Learning Objectives

Individual Keys in This Chapter

Key 7—Using Functions, Graphs, and Equations

A. Overview

B. The Concept of a Functional Relationship

C. Using Graphs

Key 8—Marginal Measures


Marginal Measures in Microeconomics

Marginal Measures in Macroeconomics

Key 9—The Production Possibility Frontier


The Production Possibilities Curve

Shifting the Production Possibilities Curve

Key 10—Supply and Demand


The Law of Demand

The Determinants of Demand are Variables Which Affect the Amount of a Product Purchased

The Demand Schedule

Demand Curve Shift


Supply Curve Shift

Key 11—Market Equilibrium


Determination of Market Equilibrium

The Impact on Equilibrium of Shifts in the Supply and Demand Schedules

Key 12—Relationships among Macroeconomic Variables


The Growth in Real GDP and the Rate of Unemployment

The Phillips Law

Key 13—Aggregate Demand and Supply


Aggregate Supply and Demand

Chapter 3 Review Questions

Chapter 4 – Fundamental Macroeconomic Concepts

Learning Objectives

Individual Keys in This Chapter

Key 14—Money


Kinds of Money

Functions of Money

Key 15—Prices and Resource Allocation


Pricing and Resource Allocation

Key 16—Firms, Households, and Government




Basic Forms of Business Organizations


Key 17—The Circular Flow


The Circular Flow

Key 18—Business Cycle


The Business Cycle


Key 19—Unemployment



Types of Unemployment

Cost of Unemployment

Unemployment Indicators—Unemployment Rate, Initial Jobless Claims, and Help-Wanted Index

Key 20—Inflation and Deflation


Types of Inflation

Side Effects of Deflation

Key 21—Unemployment and Full-Employment



Okun's Law

Chapter 4 Review Questions

Chapter 5 – Measuring Economic Activity

Learning Objectives

Individual Keys in This Chapter

Key 22—Gross Domestic Product


Gross Domestic Product (GDP)

Two Approaches to GDP

Putting Together the Spending Components

Putting Together the Income Components

Limitations of GDP

GDP and the Economy

Key 23—Other National Income Measures


Other National Income Accounting Concepts

National Income Accounting Formulas

Key 24—Simple Index Numbers


An Example of Simple Index Numbers

Features and Drawbacks of Simple Index Numbers

Key 25—Bundled (Weighted) Index Numbers


Examples of Bundled (Weighted) Index Numbers

Key 26—Measures of Inflation-Price Indexes


Constructing a Price Index and Measuring the Rate of Inflation

Measures of Inflation

Key 27—Index Number Problems


Use of Index Numbers

Types of Index Numbers

Features and Problems of Index Numbers

Key 28—Real and Nominal Measures


Nominal and Real Wages

Nominal and Real GDP

Key 29—Measures of Money Supply


Basic Money Supply

Other Measures of Money Supply

How Money Supply Is Used for Investment Decisions

Key 30—Measuring Unemployment



Measuring Unemployment

Chapter 5 Review Questions

Chapter 6 – Equilibrium Output and Income

Learning Objectives

Individual Keys in This Chapter

Key 31—The 45-Degree Line Graph


The 45-Degree Line and the Consumption Function

Key 32—Consumption and Marginal Propensity to Consume


Average Propensity to Consume (APC)

Marginal Propensity to Consume (MPC)

Key 33—Saving and Marginal Propensity to Save


Average Propensity to Save

Marginal Propensity to Save

Key 34—Investment


Investment Demand

The Accelerator Principle

Key 35—Determination of Equilibrium Output and Income – A Two Sector Model


Determination of Equilibrium Output and Income

Key 36—The Multiplier


The Multiplier

Key 37—Saving and Investment


Saving, Investment, and Equilibrium

Key 38—Net Exports


Net Exports

Chapter 6 Review Questions

Chapter 7 – Fiscal Policy

Learning Objectives

Individual Keys in This Chapter

Key 39—Taxation and the Consumption Function


The Consumption Function

Key 40—Government Spending


Government Spending

Key 41—The Expenditure Multiplier

A. Overview

B. The Expenditure Multiplier

Key 42—The Tax Multiplier


The Tax Multiplier

Key 43—The Balanced Budget Multiplier


The Balanced Budget Multiplier

Key 44—Fiscal Policy


Tools of Fiscal Policy

Lower Taxes and Higher Government Spending

Key 45—Inflationary Effects


Effects of Inflation

Key 46—Budget Deficits


Deficits and the Monetary-Fiscal Mix

The Public Debt and Modern Fiscal Policy

Key 47—Automatic Stabilizers


Examples of Automatic Stabilizers

Key 48—Full-employment Budget


Full-Employment Budget

Chapter 7 Review Questions

Chapter 8 – Money, Financial Markets, and the Banking System

Learning Objectives

Individual Keys in This Chapter

Key 49—The Meaning and Function of Money


Functions of Money

Key 50—Financial Instruments


Debt and Equity Instruments

Money Market Instruments

Capital Market Instruments

Key 51—Financial Institutions and Markets


Financial Intermediaries

Financial Markets

Money Markets

Capital Markets

Organized Exchanges and Over-The-Counter Markets

Primary Markets and Secondary Markets

Other Financial Markets

Key 52—The Federal Reserve System


Structure of the Federal Reserve System

The Federal Reserve Banks

Board of Governors

Federal Open Market Committee

Federal Advisory Council

Member Banks

Key 53—Functions of the Federal Reserve

A. Overview

B. Federal Reserve System and Monetary Policy

Key 54—Organization of the Banking System


First Bank of the United States

Second Bank of the United States

The National Banking Act

The Federal Reserve Act

Key 55—How Banks Create Money


The Process of Creation of Bank Deposits

Demand Deposit Multiplier

Key 56—Demand for Money Balances


Demand for Money Balances

Key 57—The Federal Reserve and the Money Supply


The Fed and Monetary Policy

Other Mechanisms Used By the Fed to Control Money Supply

Key 58—Interest and Interest Rates


The Function of the Interest Rate

Equilibrium Interest Rate

Different Types of Interest Rates

Types of Interest Rates

Chapter 8 Review Questions

Chapter 9 – Monetary Policy

Learning Objectives

Individual Keys in This Chapter

Key 59—Price Level and Inflation


Different Prices and Inflation

Key 60—Income and Interest Rates


Equilibrium Income and the Rate of Interest

Key 61—Investment and Interest Rates


The Marginal Efficiency of Investment Curve

Key 62—The Quantity Theory of Money


The Quantity Theory of Money

Equation of Exchange

Key 63—Interest and Money Demand


Money Demand and Interest

Key 64—Supply of and Demand for Money


Supply of Money

Demand for Money

Key 65—Tools of Monetary Policy


Monetary Policy Tools

Major Tools

Other Policy Tools

Chapter 9 Review Questions

Chapter 10 – The Full Macroeconomic Model

Learning Objectives

Individual Keys in This Chapter

Key 66—Aggregate Supply and Demand: Equilibrium


Aggregate Demand

Aggregate Supply: Short Run and Long Run

The Equilibrium

Recent American Experience

Inflationary and Recessionary Gaps

Key 67—Aggregate Supply: Short Run


The Short-Run Aggregate Supply (As) Curve

Properties of the Short-Run as Curve

Key 68 – Aggregate Supply: Long-Run

A. Overview

B. The Long-Run Aggregate Supply (AS) Curve

Key 69—Labor Supply, Wages, and Productivity


General Level of Wages

Wage Determination under Perfect Competition

Wage Determination with Imperfect Competition

The Effect of Unions on Wages

Wage Differentials


Key 70—The Phillips Curve


Why of the Phillips Curve

A Choice of Finding a Fiscal-Monetary Mix

Key 71—Aggregate Demand


The Aggregate Demand Curve

The Reasons for the Inverse Relationship

Key 72—Equilibrium in Money and Goods Markets


The Linkages between the Two Markets

The Policy Implication

Key 73—Stagflation


Measures for Curing Stagflation

Key 74—Federal Deficits


Arguments for a Balanced Budget

Gramm-Rudman-Hollings Act

Chapter 10 Review Questions

Chapter 11 – International Trade and Finance

Learning Objectives

Individual Keys in This Chapter

Key 75—Gains From Trade


Law of Comparative Advantage

Key 76—The Foreign Trade Multiplier


The “Bathtub Theorem”

Three Scenarios for Net Exports

Assumptions of the Open-Economy Model

Multiplier Effect

Key 77—The Case for Free Trade


Absolute Advantage

Comparative Advantage

The Argument for Free Trade

Trading Blocs and the World Trade Organization (WTO)

Key 78—The Case for Restricted Trade


Analyzing Quotas and Tariffs

Visible and Invisible Effects

Key 79—Arguments for Protection


Infant-Industry Argument

National-Security Argument

Wage-Protection Argument

Employment-Protection Argument

Key 80—The Balance Of Payments


Components of Balance of Payments

Balance of Trade

Key 81—The Foreign Exchange Market


The Foreign Exchange Market

Key 82—Strong Dollar and Weak Dollar


Fixed Exchange Rates vs. Flexible (Floating Exchange) Rates

Forward Exchange Rate

Strong Dollar and Weak Dollar

Key 83—Correcting a Persistent Payments Deficit


Rise in Home Country Price of Imports

Fall in Foreign Currency Price of Exports

Rise in Interest Rates

External and Internal Goals and Policy Conflicts

Restrictive Trade and Investment Policies

Chapter 11 Review Questions

Chapter 12 – Issues in Macroeconomics

Learning Objectives

Individual Keys in This Chapter

Key 84—The Classical (Market Clearing) Model


Features of Classical Economics

Key 85—Keynesianism


Keynesian Theory

Key Features of Keynesian Economics

Key 86—Monetarism



Keynesians vs. Monetarists

Key 87—Neoclassical Macroeconomics


Features of Neoclassical Economics

Alfred Marshall

Key 88—Rational Expectations


The Basic Ideas of Rational-Expectations Theory

New Classical View

Key 89—Supply-Side Economics


Supply-Side Economics vs. Demand-Side Economics

The Laffer Curve

Chapter 12 Review Questions

Review Question Answers and Rationales



Final Examination

Answer Sheet

Course Evaluation


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