Introduction to Macroeconomics

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Oct 28, 2013 (3 years and 9 months ago)

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ABSE 102

Introduction to Macroeconomics

Course Description and Objectives

This Subject has a goal to provide a basic knowledge of the macroeconomic environment in which
consumers, businesses, and governments operate and also to provide the students with an

understanding of the various notions and concepts of macroeconomics.
It is
an introduction to the
major issues facing the world's economies, to the methods that economists use to study those issues,
and to the policy problems that those issues create. It
will not give you all the answers, or all the
professional skills of an economist, but will provide you with a toolbag of basic analytical techniques
which you would need to effectively function as an active participant in the ever changing world we
live.
Economics is a way of thinking about problems, not a set of answers ready to be taken off the
shelf. Therefore, the major objective of the course is to help you develop systematic, critical and
independent thinking of today's macroeconomic problems.

Subjec
t Matter
:

1.

Key concepts of macroeconomics; objectives and instruments of macroeconomics. Aggregate
s
upply and
d
emand and their curves.

2.

Measuring economic activity:
g
ross
d
omestic
p
roduct,
r
eal and
n
ominal GDP,
p
rice
i
ndexes
and
i
nflation.

3.

Consumption,
i
ncom
e, and
s
aving
s
; consumption and saving functions, marginal propensity to
consume and to save. Determinants of investment; the investment demand curve.

4.

Business fluctuations; features of the business cycle, business cycle theories, and forecasting
business
cycles. Foundations of
a
ggregate demand; the downward sloping
a
ggregate
d
emand
curve, relative importance of factors influencing demand.

5.

The basic multiplier model; output determination with savings and investments; output
determination by consumption and
investment, the multiplier model in perspective. Fiscal
policy in the multiplier model; how government fiscal policies affect output, fiscal policy
multipliers
.

Required Text

Samuelson P. and W. Nordhaus.
McGraw
-
Hill International.

Violaris I. Economics: A

Bilingual Approach. ΕΚΔΟΣΕΙΣ ΕΠΙΦΑΝΙΟΥ, 2008



I

hope to challenge your interest the following ways:

1.

To help you
recognize

and
identify
macroeconomic problems and enable you to know
what
questions

to ask and how to formulate them;

2.

To engage you in search
ing for possible and appropriate answers, and developing
your own

understanding of the real world of macroeconomics;

3.

To encourage you to enjoy
"doing" macroeconomics

-

reading, thinking, talking, and writing
about events, issues, and ideas.

All of this m
eans that
you
:


1.

Should achieve a
basic understanding

of the vocabulary, concepts, and principles of
macroeconomics, develop your abilities to analyze
the performance of the economy
. This I call
economic
literacy
.

2.

Will have to cope with
evaluating

differen
t beliefs and opinions when discussing
macroeconomic problems, and develop
your own set of arguments and values
. This I call
economic
advocacy
.

3.

Should be able to make sense of economic reality, transform theoretical knowledge into
practical skills, and
ap
ply theories

to problems and policy issues. This I call
intellectual fun.

Electronic Resources



http
://
staff
.
fit
.
ac
.
cy
/
bus
.
tp


On this site you will find lecture notes, slideshow presentations

and home work
s.

http
://
epp
.
eurostat
.
cec
.
eu
.
int

http
://
www
.
oecd
.
org
/
statsportal

http
://
unstats
.
un
.
org
/

http
://
www
.
pio
.
gov
.
cy

http
://
unece
.
org
/
stats

Note
:
At various points in the course, I will upload articles, exercises, and problems on
extranet.frderick.ac.cy
we
b site. In addition, photocopies of articles wil
l be given to you. They might be helpful and as a basis for
written and oral assignments and, for exams. You will find that some of the terms or ideas are not in the book, or
not in the book in particular chapters assigned (but the book does have a glossar
y which you should use). These
terms and ideas, in particular, will be presented in class. Additionally, for some of the remaining terms, I may
give definit ions in class which differ slightly from those of book. Both are acceptable; I would like to think,
however, that definitions, explanations, and applications offered in class enrich your understanding of what is
involved. That is why class notes are important.

Tentative Course Calendar



Topics

Feb.
5
,
7

Introduction to macroeconomics. Objectives of mac
roeconomic
analysis

Feb. 1
2
, 1
4

Definitions of aggregate supply and aggregate demand

Feb.
19
, 2
1,
26


Measuring economic activity

Feb. 2
8,

March 5


Beyond the national accounts

March 7

Quiz # 1

March
12
,
14, 1
9

Consumption and saving

March 21

Invest
ment demand

March 28
,
April 2


Business fluctuations and the theory of Aggregate demand


April 4


Midterm


April
9
,
11


Output determination with savings and investments

April
16
,
18




The simple multiplier


April 23, 25


Fiscal pol
icy: goals, tools
, effectiveness


April 30

Quiz # 2

May 14

Supply side fiscal policy

May 16

Review



Scholastic Honesty


Students are responsible for understanding the University’s policy on Scholastic Honesty and are
required to adhere to its standards in meeting all
course requirements. Violations of the policy include,
among other practices:

1.

Cheating;

2.

Plagiarizing;

3.

Collaborating on assignments without prior permission of the instructor;

4.

Submitting papers written wholly or partly by someone else;

5.

Helping someone else
commit an act of scholastic dishonesty.


Common violations are copying from someone else’s test paper, using unauthorized books or notes
during a test, and using previously published material without clear citations to identify the source.


Any instance o
f academic dishonesty

that comes to my attention will be punished quickly and
severely. No student who I catch cheating on any quiz or exam will be allowed to pass the course. The
definition of "cheating" includes knowingly providing unauthorized help to o
ther students on quizzes
or exams.

Grading Procedures


2 quizzes @
8

% each

1
6
%

midterm exam
20
%

20
%

Homework and participation

4
%

Final Examination

60%


The success of our course will depend to a great extent on your ability to come to class well p
repared
and be ready to discuss and debate key concepts and ideas. This means, that you will have to read
recommended texts and think about your questions and problems
before
class lectures. Using class
notes will make reading time far more efficient! Try
to apply principles to new and varied settings.
The assessment strategy is designed to test your problem solving abilities, focusing upon the
application of economic models to the real world. You are expected to make full use of the learning
support materi
als and should not expect to do well by relying only on the core text and the lectures.
You will be rewarded for the use of relevant, up
-
to
-
date references in your work.

Finally, do not hesitate to ask questions. If you are having some difficulties, pleas
e, see me as soon as
you can. The academic difficulties that we postpone dealing with do not always go away with the
passage of time. All questions and discussions are welcomed and, I hope, we all would benefit from
this. I encourage you to ask questions a
nd debate eit
her in class or over the E
-
mail:
ptanova@gmail.com

If you have additional questions about the course, please contact me directly.

Office hours:

Monday 10:50


11:50 and 13:40
-

14:40

Wednesday 1
3
:
0
0
-

1
4
:00

Thursday 1
1
:50


1
2
:
5
0

Friday
10:5
0


11:50 and
13:40


14:40

or by appointment.