Four Markets in MacroeconomicsMacroeconomics is concerned with choices in an intertemporal setting within four market.

GOODS MARKETBy Goods Market we mean all the buying and selling of goods and services. In a closed economy: there is no foreign trade. X= IM = 0people and businesses in the economy do not buy products made in other countries and they do not sell any of the products they make to residents of foreign countries.All of the above are correct.

BONDS MARKETBonds, also known as fixed-income securities, are debt instruments created for the purpose of raising capital. Essentially loan agreements between an issuer and an investor, the terms of a bond obligate the issuer to repay the amount of principal at maturity. Most bonds also require that the issuer pay the investor a specific amount of interest on a semi-annual basis. A financial marketplace where debt instruments, primarily bonds, are bought and sold is called a bond market. The dealings in a bond market are limited to a small group of participants. Contrary to stock or commodities trading, the bond market (also known as the debt market) lacks a central exchange.

Types of BondsCorporate: includes trading in debt securities issued by corporations and industries to raise funds. Government and Agency: involves trading in bonds issued by government departments as well as enterprises sponsored by the government or agencies backed by it. Municipal: covers transactions in municipal securities issued by states, districts and counties. Mortgage Backed Securities: includes dealings in asset-backed securities that are protected by mortgages. (A mortgage represents a loan or lien on a property/house that has to be paid over a specified period of time. )

LABOUR MARKET Labour markets function through the interaction of workers and employers. In the case of labour market equilibrium, ND = NS .This determines the equilibrium values of the real wage and employment. It is implicitly assumed that in equilibrium everyone who wants a job has a job. In this sense, the equilibrium value of employment is also called full employment.

Four Types of Labour Market Unskilled Labour Market Semiskilled Labour Market Skilled Labour Market Professional Labour Market

MONEY MARKET(MM)The MM is used by participants as a means for borrowing and lending in the short term maturity period ranging from 30 days to a year. MM securities consist of negotiable certificates of deposit (CDs), bankers acceptances, Treasury bills, commercial paper, municipal notes, federal funds and repurchase agreements (repos).The only demerit accompanying the MM is the disorganization. Unlike organized markets, e.g. capital markets, the MM is unregulated and informal. In addition, this market gives lesser returns to the investor. However, the money market is regarded as safe.

The Money Supply M1, M2, M3 and M4 The terms M1, M2, M3 and M4 refer to the monetary aggregates. M1 normally include coins and notes in circulation and other money equivalents that are easily convertible into cash. M2 includes M1 + short-term time deposits in banks and 24-hour money market funds. M3 includes M2 + longer-term time deposits and money market funds with more than 24-hour maturity. The exact definitions of the three measures depend on the country. For knowing more about the definition of M1, M2, M3 and M4 see http://www.rbi.org.in/scripts/PublicationsView.aspx?id=9455M4 includes M3 + other deposits. The term broad money is used to describe M2, M3 or M4, depending on the local practice.

Demand for MoneyThe interaction between money and its substitutes explain why the demand for money changes. Factors which can cause the change in demand for money: Interest Rates Consumer Spending Precautionary Motives Transaction Costs for Stocks and Bonds Change in the General Level of Prices

Rising oil Prices and Related Markets