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Principles of Economics, 2nd Edition

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Principles of Economics, 2nd Edition

This comprehensive second edition of Principles of Economics introduces students to fundamental economic concepts with a focus on current examples, real-world applications, and updated data. Students are encouraged to start thinking like economists with engaging exercises including Chapter Projects, Group Activities, Reflection Questions, and more.

Second edition enhancements include a new chapter on indifference curves, current information on how the Fed conducts monetary policy post-Great Recession, and updated content about the impacts of the COVID-19 pandemic on the global economy. The appendix includes a mathematics review section to target skill gaps in topics such as graphing, equation solving, and area calculations.

Principles of Economics is designed to provide students with a thorough understanding of core economic concepts, equipping them to think critically about the implications of these theories and principles both within a global framework and in their own lives.

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Formats: Software, Textbook, eBook

Product ISBN
Software + eBook 978-1-64277-669-0
Software + eBook + Textbook 978-1-64277-668-3
Textbook 978-1-64277-666-9

Table of Contents

  1. Chapter 1: Welcome to Economics!
    1. 1.1 What Is Economics, and Why Is It Important?
    2. 1.2 Economic Theories, Models, and Systems
    3. Chapter 1 Review
  2. Chapter 2: Choice in a World of Scarcity
    1. 2.1 How Individuals Make Choices Based on Their Budget Constraint
    2. 2.2 The Production Possibilities Frontier and Social Choices
    3. 2.3 Confronting Objections to the Economic Approach
    4. Chapter 2 Review
  3. Chapter 3: Demand and Supply
    1. 3.1 Demand, Supply, and Equilibrium in Markets for Goods and Services
    2. 3.2 Shifts in Demand and Supply for Goods and Services
    3. 3.3 Changes in Equilibrium Price and Quantity: The Four-Step Process
    4. 3.4 Price Ceilings and Price Floors
    5. 3.5 Demand, Supply, and Efficiency
    6. Chapter 3 Review
  4. Chapter 4: Labor and Financial Markets
    1. 4.1 Demand and Supply at Work in Labor Markets
    2. 4.2 Demand and Supply in Financial Markets
    3. 4.3 The Market System as an Efficient Mechanism for Information
    4. Chapter 4 Review
  5. Chapter 5: Elasticity
    1. 5.1 Price Elasticity of Demand and Price Elasticity of Supply
    2. 5.2 Polar Cases of Elasticity and Constant Elasticity
    3. 5.3 Elasticity and Pricing
    4. 5.4 Elasticity in Areas Other Than Price
    5. Chapter 5 Review
  6. Chapter 6: Consumer Choices
    1. 6.1 Consumption Choices
    2. 6.2 How Changes in Income and Prices Affect Consumption Choices
    3. 6.3 Behavioral Economics: An Alternative Framework for Consumer Choice
    4. Chapter 6 Review
  7. Chapter 7: Indifference Curves
    1. 7.1 Utility-Maximizing with Indifference Curves
    2. 7.2 Responses to Changes in Income and Prices
    3. 7.3 Indifference Curves with Labor-Leisure and Intertemporal Choices
    4. Chapter 7 Review
  8. Chapter 8: Production, Costs, and Industry Structure
    1. 8.1 Explicit and Implicit Costs, and Accounting and Economic Profit
    2. 8.2 Production in the Short Run
    3. 8.3 Costs in the Short Run
    4. 8.4 Production in the Long Run
    5. 8.5 Costs in the Long Run
    6. Chapter 8 Review
  9. Chapter 9: Perfect Competition
    1. 9.1 Perfect Competition and Why It Matters
    2. 9.2 How Perfectly Competitive Firms Make Output Decisions
    3. 9.3 Entry and Exit Decisions in the Long Run
    4. 9.4 Efficiency in Perfectly Competitive Markets
    5. Chapter 9 Review
  10. Chapter 10: Monopoly
    1. 10.1 How Monopolies Form: Barriers to Entry
    2. 10.2 How a Profit-Maximizing Monopoly Chooses Output and Price
    3. Chapter 10 Review
  11. Chapter 11: Monopolistic Competition and Oligopoly
    1. 11.1 Monopolistic Competition
    2. 11.2 Oligopoly
    3. Chapter 11 Review
  12. Chapter 12: Monopoly and Antitrust Policy
    1. 12.1 Corporate Mergers
    2. 12.2 Regulating Anticompetitive Behavior
    3. 12.3 Regulating Natural Monopolies
    4. 12.4 The Great Deregulation Experiment
    5. Chapter 12 Review
  13. Chapter 13: Environmental Protection and Negative Externalities
    1. 13.1 The Economics of Pollution
    2. 13.2 Policies to Reduce Pollution
    3. 13.3 The Benefits and Costs of U.S. Environmental Laws
    4. 13.4 International Environmental Issues
    5. 13.5 The Tradeoff between Economic Output and Environmental Protection
    6. Chapter 13 Review
  14. Chapter 14: Positive Externalities and Public Goods
    1. 14.1 Why the Private Sector Underinvests in Innovation
    2. 14.2 How Governments Can Encourage Innovation
    3. 14.3 Public Goods
    4. Chapter 14 Review
  15. Chapter 15: Labor Markets and Income
    1. 15.1 The Theory of Labor Markets
    2. 15.2 Wages and Employment in an Imperfectly Competitive Labor Market
    3. 15.3 Market Power on the Supply Side of Labor Markets
    4. 15.4 Employment Discrimination
    5. 15.5 Immigration
    6. Chapter 15 Review
  16. Chapter 16: Poverty and Economic Inequality
    1. 16.1 Drawing the Poverty Line
    2. 16.2 The Poverty Trap
    3. 16.3 The Safety Net
    4. 16.4 Income Inequality: Measurement and Causes
    5. 16.5 Government Policies to Reduce Income Inequality
    6. Chapter 16 Review
  17. Chapter 17: Information, Risk, and Insurance
    1. 17.1 The Problem of Imperfect Information and Asymmetric Information
    2. 17.2 Insurance and Imperfect Information
    3. Chapter 17 Review
  18. Chapter 18: Financial Markets
    1. 18.1 How Businesses Raise Financial Capital
    2. 18.2 How Households Supply Financial Capital
    3. 18.3 How to Accumulate Personal Wealth
    4. Chapter 18 Review
  19. Chapter 19: Public Economy
    1. 19.1 Voter Participation and Costs of Elections
    2. 19.2 Special Interest Politics
    3. 19.3 Flaws in the Democratic System of Government
    4. Chapter 19 Review
  20. Chapter 20: The Macroeconomic Perspective
    1. 20.1 Measuring the Size of the Economy: Gross Domestic Product
    2. 20.2 Adjusting Nominal Values to Real Values
    3. 20.3 Comparing GDP among Countries
    4. 20.4 How Well GDP Measures the Well-Being of Society
    5. Chapter 20 Review
  21. Chapter 21: Economic Growth
    1. 21.1 The Relatively Recent Arrival of Economic Growth
    2. 21.2 Labor Productivity and Economic Growth
    3. 21.3 Components of Economic Growth
    4. 21.4 Economic Convergence
    5. Chapter 21 Review
  22. Chapter 22: Unemployment
    1. 22.1 How Economists Define and Compute Unemployment Rate
    2. 22.2 Patterns of Unemployment
    3. 22.3 What Causes Changes in Unemployment over the Short Run
    4. 22.4 What Causes Changes in Unemployment over the Long Run
    5. Chapter 22 Review
  23. Chapter 23: Inflation
    1. 23.1 Tracking Inflation
    2. 23.2 How to Measure Changes in the Cost of Living
    3. 23.3 How the U.S. and Other Countries Experience Inflation
    4. 23.4 The Confusion over Inflation
    5. 23.5 Indexing and Its Limitations
    6. Chapter 23 Review
  24. Chapter 24: The International Trade and Capital Flows
    1. 24.1 Measuring Trade Balances
    2. 24.2 Trade Balances and Flows of Financial Capital
    3. 24.3 The National Saving and Investment Identity
    4. 24.4 The Pros and Cons of Trade Deficits and Surpluses
    5. 24.5 The Difference between Level of Trade and the Trade Balance
    6. Chapter 24 Review
  25. Chapter 25: The Aggregate Demand/Aggregate Supply Model
    1. 25.1 Building a Model of Aggregate Demand and Aggregate Supply
    2. 25.2 Shifts in Aggregate Supply
    3. 25.3 Shifts in Aggregate Demand
    4. 25.4 How the AD/AS Model Incorporates Growth, Unemployment, and Inflation
    5. 25.5 Keynes' Law and Say's Law in the AD/AS Model
    6. Chapter 25 Review
  26. Chapter 26: The Keynesian Perspective
    1. 26.1 Aggregate Demand in Keynesian Analysis
    2. 26.2 The Building Blocks of Keynesian Analysis
    3. 26.3 The Phillips Curve
    4. 26.4 Keynesian Policy and the Keynesian Perspective on Market Forces
    5. Chapter 26 Review
  27. Chapter 27: The Neoclassical Perspective
    1. 27.1 The Building Blocks of Neoclassical Analysis
    2. 27.2 The Policy Implications of the Neoclassical Perspective
    3. 27.3 Balancing Keynesian and Neoclassical Models
    4. Chapter 27 Review
  28. Chapter 28: Money and Banking
    1. 28.1 Defining Money by Its Functions
    2. 28.2 Measuring Money: Currency, M1, and M2
    3. 28.3 The Role of Banks
    4. 28.4 How Banks Create Money
    5. Chapter 28 Review
  29. Chapter 29: Monetary Policy and Bank Regulation
    1. 29.1 The Federal Reserve Banking System and Central Banks
    2. 29.2 Bank Regulation
    3. 29.3 How a Central Bank Executes Monetary Policy
    4. 29.4 Monetary Policy and Economic Outcomes
    5. 29.5 Pitfalls for Monetary Policy
    6. Chapter 29 Review
  30. Chapter 30: Exchange Rates and International Capital Flows
    1. 30.1 How the Foreign Exchange Market Works
    2. 30.2 Demand and Supply Shifts in Foreign Exchange Markets
    3. 30.3 Macroeconomic Effects of Exchange Rates
    4. 30.4 Exchange Rate Policies
    5. Chapter 30 Review
  31. Chapter 31: Government Budgets and Fiscal Policy
    1. 31.1 Government Spending
    2. 31.2 Taxation
    3. 31.3 Federal Deficits and the National Debt
    4. 31.4 Using Fiscal Policy to Fight Recession, Unemployment, and Inflation
    5. 31.5 Automatic Stabilizers
    6. 31.6 Practical Problems with Discretionary Fiscal Policy
    7. 31.7 The Question of a Balanced Budget
    8. Chapter 31 Review
  32. Chapter 32: The Impacts of Government Borrowing
    1. 32.1 How Government Borrowing Affects Investment and the Trade Balance
    2. 32.2 Fiscal Policy and the Trade Balance
    3. 32.3 How Government Borrowing Affects Private Saving
    4. 32.4 Fiscal Policy, Investment, and Economic Growth
    5. Chapter 32 Review
  33. Chapter 33: Macroeconomic Policy around the World
    1. 33.1 The Diversity of Countries and Economies across the World
    2. 33.2 Improving Countries' Standards of Living
    3. 33.3 Causes of Unemployment and Inflation around the World
    4. 33.4 Balance of Trade Concerns
    5. Chapter 33 Review
  34. Chapter 34: International Trade
    1. 34.1 Absolute and Comparative Advantage
    2. 34.2 What Happens When a Country Has an Absolute Advantage in All Goods
    3. 34.3 Intra-industry Trade between Similar Economies
    4. 34.4 The Benefits of Reducing Barriers to International Trade
    5. Chapter 34 Review
  35. Chapter 35: Globalization and Protectionism
    1. 35.1 Protectionism: An Indirect Subsidy from Consumers to Producers
    2. 35.2 International Trade and Its Effects on Jobs, Wages, and Working Conditions
    3. 35.3 Arguments in Support of Restricting Imports
    4. 35.4 Trade Policy
    5. Chapter 35 Review
  36. Appendix: Math Review
    1. A.1 Addition and Subtraction
    2. A.2 Multiplication and Division
    3. A.3 Order of Operations
    4. A.4 Algebraic Expressions
    5. A.5 Basics of Percent
    6. A.6 Linear Equations
    7. A.7 Graphing
    8. A.8 Calculating Area
    9. Appendix Review