More of this book is devoted to applications--and less to formal economic theory--than is the case with many other books written for the principles course. Most chapters include case studies illustrating how the principles of economics are applied. In addition, "In The News" boxes offer excerpts from newspaper articles showing how economic ideas shed light on current issues facing society. After students finish their first course in economics, they should think about news stories from a new perspective and with greater insight...

PART 1      INTRODUCTION  1

CHAPTER 1   Ten Principles of Economics 3

CHAPTER 2   Thinking Like an Economist 19

CHAPTER 3   Interdependence and the Gains from Trade 47

PART 2  HOW MARKETS WORK 61

CHAPTER 4   The Market Forces of Supply and Demand 63

CHAPTER 5   Elasticity and Its Application 89

CHAPTER 6   Supply, Demand, and Government Policies 113

PART 3      MARKETS AND WELFARE  135

CHAPTER 7   Consumers, Producers, and the Efficiency of Markets 137

CHAPTER 8   Application: The Costs of Taxation 159

CHAPTER 9   Application: International Trade 177

PART 4      THE ECONOMICS OF THE PUBLIC SECTOR 201

CHAPTER 10  Externalities 203

CHAPTER 11  Public Goods and Common Resources 223

CHAPTER 12  The Design of the Tax System 241

PART 5   FIRM BEHAVIOR AND THE ORGANIZATION OF INDUSTRY 265

CHAPTER 13  The Costs of Production 267

CHAPTER 14  Firms in Competitive Markets 289

CHAPTER 15  Monopoly 311

CHAPTER 16  Oligopoly 345

CHAPTER 17  Monopolistic Competition 373

PART 6      THE ECONOMICS OF LABOR MARKETS 391

CHAPTER 18  The Markets for the Factors of Production 393

CHAPTER 19  Earnings and Discrimination 413

CHAPTER 20  Income Inequality and Poverty 431

PART 7      TOPICS FOR FURTHER STUDY  453

CHAPTER 21  The Theory of Consumer Choice 455

CHAPTER 22  Frontiers of Microeconomics 483

PART 8  THE DATA OF MACROECONOMICS  505

CHAPTER 23  Measuring a Nation's Income 507

CHAPTER 24  Measuring the Cost of Living 529

PART 9      THE REAL ECONOMY IN THE LONG RUN 547

CHAPTER 25  Production and Growth 549

CHAPTER 26  Saving, Investment, and the Financial System 575

CHAPTER 27  The Basic Tools of Finance 597

CHAPTER 28  Unemployment 613

PART 10     MONEY AND PRICES IN THE LONG RUN 639

CHAPTER 29  The Monetary System 641

CHAPTER 30  Money Growth and Inflation 661

PART 11     THE MACROECONOMICS OF OPEN ECONOMIES  689

CHAPTER 31  Open-Economy Macroeconomics: Basic Concepts 691

CHAPTER 32  A Macroeconomic Theory of the Open Economy 715

PART 12    SHORT-RUN ECONOMIC FLUCTUATIONS 737

CHAPTER 33  Aggregate Demand and Aggregate Supply 739

CHAPTER 34  The Influence of Monetary and Fiscal Policy on Aggregate Demand 777

CHAPTER 35  The Short-Run Tradeoff between Inflation and Unemployment 801

PART 13     FINAL THOUGHTS  831

CHAPTER 36  Five Debates over Macroeconomic Policy 833

Appendix: Quick Quiz Answers 857

Glossary 873

Index 879