Fundamentals of macroeconomics, discussing the components in detail

1. Introduction to
Macroeconomics

3. Principles of
Macroeconomics
Y=C+I+G+(X-M)
 Consumption
 Investment
 Government Spending & Macroeconomics

4. Consumption (C)
The direct and final use of goods and services in the
satisfaction of human wants
Importance of Consumption
1. Beginning of all Economic Activities
2. End of all Economic Activities
3. Index of Standard of Living
4. Importance in Economic Theory
5. Importance for the Government
6. Importance in Income and Employment Theory

5. Investment (I)
Types of Investment
 private investment or public investment
 induced or autonomous

6. Government spending (G)
Government spending, revenue raising, and borrowing,
has a crucial role to play in any mixed economy.
The purpose of government expenditure
 To supply goods and services
 achieve supply-side improvements
 subsidize industries which may need financial support
 To inject extra spending

7. International trade (X-M)
The Flow of Goods: Exports, Imports and Net Exports
Net Exports = Value of country’s exports – Value of
country’s imports
Things related to Trade
 Capital Gains
 Free Trade Vs. Protectionism

8. Applications of Macroeconomics
for Managers
 Economic Growth & Business
 Inflation & Business
 International Trade & Business
 Recession & Business
 Financial Markets & Business

9. Conclusion
it is important to keep track of macroeconomic trends in
order to keep the business afloat, since business
decisions cannot be taken in isolation without
considering the macroeconomic environment.