What's in Principles of Macroeconomics, unit by unit

Principles of Macroeconomics studies the economy as a whole: total output, the unemployment rate, the price level, interest rates, the government budget and the trade balance. Encodr's free Principles of Macroeconomics course follows the 21 chapters of OpenStax Principles of Macroeconomics 3e plus its appendices on graphs and the expenditure-output model, split into 21 units, 96 chapters and 1,270 study cards.

The course has four movements. It borrows the microeconomic toolkit, learns to measure the whole economy, builds a model of it, and then uses that model to judge monetary and fiscal policy. Here is each unit in teaching order.

The shared foundations (units 1-5)

The first five units are the same chapters, and the same cards, as units 1 to 5 of Principles of Microeconomics. Both OpenStax books open this way. Together they are 20 chapters and 383 cards.

Unit 1, Welcome to Economics (5 chapters, 58 cards). Scarcity, micro versus macro, models and the circular flow, economic systems, and the math appendix on slopes and graphs.

Unit 2, Choice in a World of Scarcity (3 chapters, 76 cards). Budget constraints, opportunity cost, the production possibilities frontier, and positive versus normative statements.

Unit 3, Demand and Supply (5 chapters, 114 cards, the largest unit). Equilibrium, shifts, the four-step process, price controls and surplus.

Unit 4, Labor and Financial Markets (3 chapters, 60 cards). Supply and demand for labor and for loanable funds. The financial-markets chapter is the seed of the saving and investment identity used much later.

Unit 5, Elasticity (4 chapters, 75 cards). The midpoint formula, the total revenue rule and tax incidence; price elasticity of demand explained walks through it.

If you have already taken micro, these units are review, and a quick self-quiz will tell you which parts survived better than rereading would (why rereading notes doesn't work explains the gap). If you haven't, unit 3 matters most: the aggregate demand and supply model later borrows its logic, and its warnings about where that logic breaks.

Measuring the economy (units 6-10)

These five units (24 chapters, 304 cards) are where most of the course's formulas live.

Unit 6, The Macroeconomic Perspective (5 chapters, 80 cards). GDP as C + I + G + (X - M), final versus intermediate goods, nominal versus real GDP and the GDP deflator, recessions and expansions, comparing GDP across countries with exchange rates and per-capita figures, and what GDP leaves out.

Unit 7, Economic Growth (4 chapters, 48 cards). The arrival of modern growth with the Industrial Revolution, labor productivity, compound growth and the rule of 70, physical capital, human capital and technology, and the arguments for and against convergence between rich and poor countries.

Unit 8, Unemployment (4 chapters, 64 cards). Who counts as unemployed, the unemployment rate and labor force participation rate, patterns over time, sticky wages and cyclical unemployment, and the natural rate (frictional plus structural).

Unit 9, Inflation (5 chapters, 64 cards). Baskets and price indexes, the CPI and its biases, US and world inflation history, who gains and loses from unexpected inflation, and indexing.

Unit 10, International Trade and Capital Flows (6 chapters, 48 cards). The trade balance and current account, why a trade deficit is an inflow of financial capital, the national saving and investment identity, and the difference between the level of trade and the trade balance.

The models (units 11-13)

Unit 11, Aggregate Demand and Aggregate Supply (6 chapters, 80 cards, tied with unit 6 for the most after unit 3). Say's law and Keynes' law, why AD slopes down, why short-run AS slopes up and long-run AS is vertical at potential GDP, what shifts each curve, and the Keynesian, intermediate and neoclassical zones. It is the center of the course; aggregate demand and aggregate supply explained works through it with numbers.

Unit 12, The Keynesian Perspective (5 chapters, 48 cards). Insufficient demand and sticky prices, the expenditure multiplier, the expenditure-output (45-degree line) model, and the Phillips curve.

Unit 13, The Neoclassical Perspective (3 chapters, 48 cards). Potential GDP and flexible prices, the policy lags that weaken active policy, the vertical long-run Phillips curve, and how the two schools fit together.

Money and monetary policy (units 14-16)

Unit 14, Money and Banking (4 chapters, 63 cards). The four functions of money, M1 and M2, bank balance sheets (T-accounts), and how banks create money through the money multiplier. The T-account is the same assets-equal-liabilities-plus-equity idea taught in Financial Accounting, applied to a bank.

Unit 15, Monetary Policy and Bank Regulation (5 chapters, 69 cards). The structure of the Federal Reserve, bank capital, runs and deposit insurance, the Fed's tools (open market operations, the discount rate, interest on reserve balances and quantitative easing), expansionary versus contractionary policy, and its pitfalls.

Unit 16, Exchange Rates and International Capital Flows (4 chapters, 49 cards). How the foreign exchange market works, what moves exchange rates (expectations, rates of return, inflation and purchasing power parity), how exchange rates feed back into AD, and policies from floating rates to a shared currency.

Fiscal policy and the world (units 17-19)

Unit 17, Government Budgets and Fiscal Policy (7 chapters, 64 cards, the most chapters of any unit). Deficits versus debt, taxes and brackets, the debt-to-GDP ratio, expansionary and contractionary fiscal policy, automatic stabilizers, crowding out and policy lags, and the balanced-budget amendment debate. The legislative side of budgets (how Congress passes them) is covered in what's in American Government.

Unit 18, The Impacts of Government Borrowing (4 chapters, 32 cards). The saving and investment identity with a government budget, twin deficits, Ricardian equivalence, and borrowing's effect on investment and growth.

Unit 19, Macroeconomic Policy around the World (5 chapters, 32 cards). Income groups, growth policy at different income levels, why unemployment and inflation differ between countries, and trade-balance crises.

Trade (units 20-21)

Unit 20, International Trade (4 chapters, 59 cards) and Unit 21, Globalization and Protectionism (5 chapters, 39 cards) are again shared with the micro course (its units 19 and 20): comparative advantage, intra-industry trade, tariffs and quotas, the arguments for protection, and the WTO.

So of the 21 units, 7 are shared with micro, and 14 are macro only.

Where the math and the memorizing are

Each calculation is a typed card whose answer was recomputed by script, and every graph (AD/AS, the Phillips curve, the foreign exchange market) is described in words. How to study for macroeconomics has a plan for each type. Because the course is long and the models in units 11 to 17 lean on everything before them, it suits spaced review more than end-of-term cramming; cramming vs spacing lays out why. To size the workload, the flashcard deck time estimator turns 1,270 cards into days.

Macro is one of the courses in free college gen-ed course flashcards, and the full course is free on Encodr as Principles of Macroeconomics flashcards.