1. National Income Accounting
   1. WHY?
      1. Structure of macroeconomics model
         1. Input and Output
         2. production and demand (Output)
            1. Production
            2. interests and dividends(capital)
            3. wages(labor)
            4. Growth & AS(Aggregate Supply )
            5. Demand
            6. Consumption
            7. Investment (Private Investment specifically from firms)
            8. Others
            9. AD (Aggregate Demand)
      2. Numbers characterized the economy
         1. rough magnitudes
            1. linking reality and theory
   2. What?
      1. GDP(Gross Domestic Product)
         1. Factor
            1. Time: within a given period
            2. Region: In the country
            3. Essence: Value of ALL FINAL goods and services produced
            4. Definition: GDP is the value of all final goods and services produced in the country within a given period.
         2. Valued at aggregate market price
      2. GNP(Gross National Product)
      3. NDP(Net domestic product)
      4. NI (National Income)
      5. Yd(个人可支配收入)
   3. Relationships
      1. Fundamental National Income Accounting Identity
         1. Y=C+I+G+NX
            1. Essence: Where has the output gone?
            2. Why NX? Import is contained in C, I, G...
            3. NX: a component of the foreign total demand for our goods
   4. Some Important Identities
      1. Assumption
         1. 1. GDP=GNP
         2. 2.No Depreciation
         3. 3. NO Indirect Tax and Transfer Payments
         4. Basic Assumption through the WHOLE book
      2. Simple Economy: Without Government and export
         1. Y=C+I
            1. C+I=Y=Yd=C+S
            2. I=S
      3. Reintroducing the Government and Foreign Trade
         1. S-I=(G+TR-TA)+NX==> S-I+(TA-(G+TR))=NX
2. 1st Model----Keynesian model(the most basic one)
   1. Central Assumption
      1. for the time being, prices do not change at all
      2. firms are willing to sell any amount of output at the given level of prices
      3. I=I拔(unique assumption)
         1. Keynesian idea of investment
      4. AS curve---- FLAT
   2. Equilibrium
      1. Y=AD=C+I+G+NX
         1. output FIRMLY defined
   3. Keynesian Consumption Function
      1. C=C拔+cYd C拔>0 (0<c<1)
      2. c---MPC(marginal propensity to consume)
         1. c is defined by culture, usally regarded as a constant
   4. Revolutionary Points
   5. 45度线图
   6. 节俭悖论
      1. 节俭--c小--AD线变"平"--均衡解出现在更加左边的位置
         1. 越节俭,越穷的悖论