Download Winona State University - Department of Economics and Finance

ECON 104- Introductory Macroeconomic Analysis and Policy
SUMMER – 2012
Instructor: Val Vlad [email protected]
Office: REDC – 295
Phone: (814) 898 -6093
Class Schedule and Location: Tuesday and Thursday
Section 602
Office Hours: Tuesday and Thursday (Hours: To be discussed)
And by appointment
_____________________________________________________________________________________________________________________________ ____________________________________________________________________________________________________________
COURSE DESCRIPTION AND COURSE OBJECTIVES
The purpose of this course is to introduce students to the realm of macroeconomics by providing the basic
but powerful tools needed to grasp the functioning of the U.S. economy in particular and the world
economy in general. The course will explore methods used by economists to monitor the overall economy.
At the end of the course the student should be able to:
 Explain fundamental economic concepts such as scarcity and choice, opportunity cost, marginal
decision making, supply and demand, economic systems, normative and positive economics.
 Have a thorough understanding of how markets function through the interaction of demand, supply,
and government policy. Use the supply and demand model to predict changes in prices and quantities
that result from changes in demand and/or supply or from changes in government policy.
 Describe the main macroeconomics institutions – households, firms, government, and the world
economy- identify their macroeconomic roles and their interrelationships using the “circular flow
model”.
 Gain understanding of basic macroeconomic performance measures. Understand how to compute (as
well as how to find statistics for) the main measures of aggregate economic activity: gross domestic
product (GDP), GDP growth, GDP per capita, price level, unemployment.
 Understand the main features and implications of the basic macroeconomic concerns facing advanced
economies: slow growth, unemployment, inflation, budget deficit, etc.
 Explain similarities and differences between: the long-run trends and short-run economic ups and
downs (i.e., business cycle).
 Gain basic knowledge on macroeconomic concepts such as aggregate supply and aggregate demand,
banking system, the money market and interest rate.
 Understand the basics of major macroeconomic analytical frameworks (models) – such as AD/AS - and
apply them to:
o explain changes in the level of aggregate economic activity (economic fluctuations), and
understand the causes of unemployment and inflation,
o understand how macroeconomic policies (Fiscal, Monetary, Supply side) practiced by the
federal government can be used to improve the aggregate economic activity.
o appreciate some of the limitations for the effective use of macroeconomic policies.
o analyze macroeconomic events and issues (such as The Great Depression).
 Understand the basics of the international (world) economy and issues such as globalization, outsourcing,
foreign investment, international trade; understand the impact of world economy on the macroeconomic
system.
ANGEL Course Website:
ANGEL is a very important source of information and our main channel of exchanging information
pertaining ECON 104. An updated version of this syllabus as well as additional course materials such as:
 Lecture Notes (LN), study guides, solutions to problems, announcements, review questions,
optional readings.
 Useful website links related to macroeconomics such as Wall Street Journal, the New York Times
and the Economist. You should be inquisitive and read through these very informative sources. If
you find an article that catches your eye, please feel free to bring it to my attention; I will try to
incorporate it into class discussions.
Log onto ANGEL (http://cms.psu.edu) and select the course. A guide is available at:
http://www.pserie.psu.edu/faculty/teachingcenter/angel/index.htm.
TEXTBOOK: Principles of Macroeconomics by Karl Case, Ray Fair, and Sharon Oster,
Book Description : One of the all time best-sellers, this text is widely used because of
its careful, streamlined, and intuitive chapter organization.
The Keynesian Cross is an integral part of this text. Case & Fair believe strongly, that a text
should use the Keynsian Cross carefully and systematically, to build up to the AD/AS Model. One
of the great benefits of this approach is that students will learn to apply the major Economics
models: from Demand & Supply to Aggregate Demand & Aggregate Supply (AD/AS model).
E-mail and Web connection: I will post most required assignments on the website for this class or
distribute them via e-mail. You must ensure that your PSU e-mail account works, and learn how to use it if
you do not already know how. I download my students’ e-mail addresses from the official University
roster, which includes the PSU e-mail addresses, so that it has to be your e-mail address for purposes of this
class. I do NOT recommend using some other e-mail account (like hotmail or yahoo); they usually have
size limitations and the items I send you probably will not get through. If you don’t get these assignments
and notices, it will adversely affect your grade in this class!
You are responsible for checking your e-mail and the course website regularly. I will always announce
in class when I’ve uploaded assignments on the course website (see ANGEL). Please get the assignment
from the website or one of your class contacts.
Other Required Materials:
 A notebook where you write down your own notes during the lecture,
 a binder where you will collect the printed lecture notes and other printed materials,
 a calculator,
 a mechanical pencil, and an eraser.
GRADING POLICY
Your grade will be determined on the basis of your performance on the following seven categories of
assignments:
1.
2.
3.
4.
5.
6.
HW and Quizzes (HWQ)
Exam 1 (Ex1)
Exam 2 (Ex2)
Exam 3 (Ex3)
Final Exam (FEX)
Course Activity (CA)
80 points
30 points
40 points
50 points
60 points
10 points (Bonus)
260 points.
HW and Quizzes: The home work sets and quizzes represent another way to help you keep up with the
material. They are intended to make you study the LNs, the Study Guides, and the textbook (if necessary).
If you do the assigned readings and review your class notes, you should do well on quizzes. A quiz may be
online or on-paper and, usually, has 7 to 10 multiple choice questions and you will have 10 to 15 minutes
to complete it.
Exams.
There will be three midterm Exams and one non-cumulative Final. Each exam will be announced at least
one week in advance. The exams are designed to test your knowledge (not mere memorization of
concepts). Exams test whether you really understand the material, and if you can use it to solve new
problems such as those you may encounter in the business world after you leave the college. The exams
will not be strictly cumulative. However, material in this class builds on previous work and material taught
earlier in the class will be incorporated in the later topics. The exams are primarily multiple choice, and
problems (short answer, essay questions, and graphs.)
Course Activity. This may include, although is not limited to:
 Class Participation. I expect you to attend class, participate and answer/ask questions. I reserve the
right to reward students who show a sustained interest in the course material, show a pattern of
sustained improvement throughout the semester, and/or do very well on the final,
 having a very well organized notebook with your handwritten notes,
 and other (to be discussed.)
GRADING:
Your course grade will depend on the total number of points you have accumulated throughout the
semester. Your final letter grade will be determined using the following grading scale:
93 – 100.00%
90 – 92.99%
87 – 89.99%
83 – 86.99%
80 – 82.99%
77 – 79.99%
70 – 76.99%
60 – 69.99%
< 60%
A
AB+
B
BC+
C
D
F
COURSE POLICY
There are a few policies/procedures that will help the class to run smoothly and make it more fair and
enjoyable to all students. A key aspect of my grading policy is that I strive for fairness for all students. This
guiding principle leads to the following policies:
Late or Missed Exams
By registering for this class, you are saying that you can be here for the regular class periods, plus the
scheduled exams. All exams are announced in advance, and it is your responsibility to know when the
exams are and to be here for them. An absence from an exam will be considered a zero for that exam,
which makes it very difficult to get a grade of C or better for the course.
The University does recognize a limited number of legitimate reasons for missing an exam, such as
participation in an official University sports contest or medical emergencies. However, fairness dictates that
no one should get unwarranted special treatment, such as extra study time, when it comes to exams. In
order to be fair to the students who take the exam on time, absences from exams will be excused only for
officially-approved reasons, and with proof. A student who misses an exam bears the burden of
providing proof that the absence should be excused. It is the student's responsibility to contact me during
office hours, and to explicitly tell me that s/he thinks the absence should be excused, tell me what the
legitimate reason is, and show me the proof. If you find that you must miss an exam for any reason,
CONTACT ME IMMEDIATELY to explain the situation and to set an alternate time for the exam. A
significant penalty may be assessed against the grade if an exam is taken late, to try to be fair to those who
took the exam on time.
Academic Dishonesty
In order to be fair to the overwhelming majority of students who are honest, I take a hard line on academic
dishonesty. I believe that academic dishonesty undermines the whole process of higher education, and
could make a Penn State degree meaningless if not prevented. I assume that you're here to get an education,
and not just a degree. Therefore, I strongly endorse the University’s policy on academic dishonesty. Be
aware that ACADEMIC DISHONESTY MAY RESULT IN AN AUTOMATIC COURSE FLUNK. When
appropriate, other sanctions (such as suspension or expulsion from the University) may be pursued.
Academic dishonesty includes, among other things, copying exam answers, attempting to get an advance
copy of the exam, changing answers on an answer sheet after a quiz or exam has been returned, and using
someone else's work when answering in-class questions for the participation grade. Working together on an
assignment outside class CAN be academic dishonesty, too, if it results in your just copying someone else’s
answers without understanding how to derive them. Academic dishonesty also includes allowing someone
else to use your work. (Don't let someone else's cheating get you into trouble!) Be advised that I will
actively enforce this policy, out of fairness to the majority of students who are honest and have to work
hard for their grades. I may be kid about a lot of things, but I'm dead serious about this. See University
Senate Policies and Rules for Students, Policy 49-20. You should also be aware that Penn State has a policy
of assigning an “academic dishonesty F” or “XF” grade which tells everyone viewing the transcript that the
F grade was due to cheating. You certainly don’t want to have to explain that during a job interview! The
PSU policy also requires faculty to notify the administration of virtually every cheating infraction, so that
multiple occurrences by one student in different classes can be identified. More severe penalties are
typically imposed when a student has had previous incidents. (They’re serious about this stuff! I hope you
are, too.) More information can be found at: http://www.pserie.psu.edu/faculty/academics/integrity.htm
Academic and Career Planning Center
The Academic and Career Planning Center (ACPC) can assist students with the process of career and life
planning through a full range of programs and services. You may schedule appointments with the ACPC
staff to discuss issues including interests, skills, values, and goal setting, as well as how to find career
information, internships, full-time jobs, and graduate schools. You are encouraged to utilize the services of
the ACPC every year from your first semester to graduation.
ACPC Location:
ACPC Phone:
ACPC Web Site:
Second floor – Reed Building
898-6164
http://psbehrend.psu.edu/Academics/academic-services/acpc
Classroom Policy
The basic guideline is very simple: be polite. Please don't talk with other students, whistle, etc. during
classes. This is distracting for other students as well as for me, and thus interferes with the education
process. If you have a question about something, it is usually best to direct it to me, rather than asking
(distracting) other students. If I see someone talking, I will usually ask them if they have a question. If a
student is doing something that interferes with the class, it is part of my job to require them to stop or to ask
them to leave the class. Usually there is not a problem with this, but it's important for you to know the rules
up front.
Food is prohibited in our classroom, and smoking is prohibited in all PSU buildings. I would also like to
ask you not to use other tobacco products in the classroom. The use of these tends to be a bit distracting to
those in the surrounding area—and me--and we have enough on our hands just dealing with the Economics,
without extraneous distractions.
Lateness
I will start the class promptly at the assigned time, and I would appreciate it if you would be in your seats
ready to go at the scheduled time. Please try to be here on time for the class, so we don't waste any of our
limited classroom time.
On the other hand, I would prefer that you come late rather than not coming at all (if those are the only two
choices.) If an occasion arises in which you MUST come late, please enter quietly and take a seat
unobtrusively. If you enter noisily or flamboyantly, you will probably interrupt the class and distract most
students, and we'd all appreciate it if you try to avoid that. (The same goes for leaving class early.) If you
come late repeatedly, I'll probably get on your case about it unless you let me know why. If you come in
late, please DO NOT walk to the front of the classroom. That disrupts the whole class and imposes costs on
everyone else.
ADA Accommodations
In keeping with the goal of the Americans with Disabilities Act (ADA), all students for whom the act
applies should notify the instructor no later than the second session of the course so that arrangements can
be made for accommodations to meet students’ educational needs and maximize learning.
ABOUT THE MATERIAL IN THIS CLASS
 The material in this course is very challenging. Although we begin at an elementary
level, we will move rapidly to concepts and issues that almost all of you will find
difficult to grasp for the first time you hear or read about.
THOROUGH UNDERSTANDING OF ECONOMICS REQUIRES A VERY HIGH
LEVEL OF SUSTAINED EFFORT ON YOUR PART. If at any time you become
confused, make an appointment to see me immediately. I will be more than eager to
help you, but I will always assume that you have first made a solid attempt at
understanding the material on your own (e.g., by reviewing all of the class materials).
•
The examinations are not designed to be tricky or ambiguous. They are rigorous in
order to differentiate between those students who are merely memorizing facts and
those who truly understand the material. Therefore, examination questions will seldom
involve regurgitation of facts. Instead, exams will often require you to apply what you
have learned to new and different situations.
•
The material in this course is cumulative, i.e., current topics presume a thorough
understanding of previously covered topics. Thus, it is essential to attend every class
meeting and keep up with the readings and other assignments. Announcements made
in class and all material covered in class are assumed to reach all students. "I must
have missed that day" will not be accepted as a legitimate excuse.
NOTES ON DOING WELL IN THIS COURSE
Please, follow the following rules:
1. Read the Lecture Notes and the Chapter in the textbook in advance so that the lectures
will be easier to understand.
2. Attend ALL lectures and (very important) pay attention.
3. After class, read the material a second time to help it sink in. Work on the exercises
from the lecture notes even though we cover them in class.
4. Work on the exercises from Study Guide.
5. Work individually on the HW problem sets; it will help you prepare for the exams.
6. Keep up with the material as we cover it in class and ask (any) questions at the start of
the following class.
7. Consider linking up with a classmate to study so that you can help each other out when
confused. Do not leave studying to the last minute – pace yourself and leave time to get
help if needed.
8. Reinforce those weak areas with more studying prior to the exams.
9. Get help if needed.