This fifth edition teaches the tools and principles that are standard for introductory economics, in a way that students can see the applications for the U.S. and world economy. The facts, anecdotes, and explanations have been scrutinized and updated throughout. Some new examples include high-profile topics at key points, like using the rise in demand for sand from fracking for principles of supply and demand, or explaining how the Federal Reserve is now conducting monetary policy by varying the interest rate paid on bank reserves. Tim Taylor has provided a complete updating of numerical graphs and statistics. In addition, this book has been structured since the first edition to mix in international topics and to consider product, labor, and capital markets side by side, which helps it apply easily to so many of the topics now in the news: effects of globalization on growth and labor markets, budget deficits, the minimum wage, health insurance, and many more.