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Course Requirements for Advanced Placement
Macro Economics
Contact information:
K. Yancy
Phone (817) 202-2500 (ext. 1270)
E-mail: [email protected]
Course overview: This course provides students with a thorough understanding of the
principles of economics that apply to an economic system as a whole. To accomplish
this, students examine national income and price determination, economic performance
measures, economic growth, and international economics.
Textbooks:
McConnell, Campbell R, and Stanley L. Brue. Economics: Principles, Problems,
and Policies. 20th ed. Boston: McGraw-Hill, 2015.
Current events: Students will be expected to find current news articles that are examples
of specific concepts discussed in each unit. More details about current events will be
given in class at the appropriate time.
Reading: In order for a student to be successful in a college class course of this type, it is
essential that students maximize their time through proper organization and planning
strategies to complete all assigned reading prior to class discussion. The required reading
along with lectures and class discussion, will figure prominently in your formal
evaluation on quizzes and examinations.
Group work: For the purpose of presentations and selected assignments, students will be
placed in groups. This is a course requirement and working alone on these activities will
not be allowed. Establishing a positive attitude and rapport within the group has proven
to be a key to success and will greatly assist in the management of the amount of reading
required.
Data and Statistical Analysis: Throughout the course of the semester, students will be
required to analyze various statistical data. This will include exercises on the computer
using Internet, assignments involving analysis of charts, graphs, and political cartoons.
Students will be asked to respond to a series of questions with respect to the data
examined that will constitute daily grades and/or test grades.
Examinations: Formal evaluations for the units will consist of multiple choice and/or
free response exams. (Exact dates will be posted in the room.)
Quizzes: At the teacher’s discretion, students will respond to brief questions about prior
content or assigned reading material.
Projects: Each six weeks, students are required to complete two projects which will
count as 1/3 of the high school six weeks average. Projects will include a compilation
and analysis of news articles that are examples of economic concepts and free response
questions. Projects may also include writing an allegory, analyzing GDP data, designing
a Farcebook page for an economist, and/or designing a economic tissue box.
High School Grading
33% Daily
34% Tests
33% Project
Concurrent credit
30% Daily
40% Exams
10% Project/Paper
20% final
Unit 1: Basic Economic Concepts (2.5 weeks)
Chps. 1-4, 38
Major topics:
A. Scarcity, choice, and opportunity costs
B. Production possibilities curve
C. Comparative advantage, specialization, and exchange
D. Demand, supply, and market equilibrium
E. Macroeconomic issues: business cycle, unemployment, inflation, and growth
Key concepts:
Scarcity, economic systems, opportunity cost, production possibilities curve (or frontier),
specialization, comparative advantage, basic economic questions, demand, supply,
determinants of demand and supply, change in quantity demanded/supplied vs. change in
demand/supply, equilibrium and macroeconomic issues
Graphs:
Production possibilities curve (or frontier)
Demand and supply showing equilibrium
Circular flow diagram
Assignments:
Quizzes
Practice problems with production possibilities frontier and supply and demand
FRQs (free response questions)
Current events: Change in Demand, Change in Supply, Production Possibilities Curve or
Comparative advantage
Unit 2: Measurement of Economic Performance (2.5 weeks)
Major topics:
A. National income accounts
Circular flow
Gross domestic product
Chps. 24-26
Components of gross domestic product
Real versus nominal gross domestic product
B. Inflation measurement and adjustment
Price indices
Nominal and real values
Costs of inflation
C. Unemployment
Definition and measurement
Types of unemployment
Natural rate of unemployment
Key concepts:
National income accounting, Gross Domestic Product (GDP), using expenditure and
income approaches, national income, Net Domestic Product (NDP), Personal Income
(PI), disposable income (DI), business cycle, full-employment rate or natural rate of
unemployment, GDP gap and Okun’s law, inflation, deflation, and hyperinflation,
unemployment
Graphs:
Circular flow model
Business cycle
Okun’s law graph
Assignments:
Quizzes
National income problems
Price indexes
Who is hurt and Who is helped by unanticipated inflation
All About GDP
FRQs
Current events: National Income Accounts, Inflation, Unemployment
Unit 3: National income and price determination (3 weeks)
Major topics:
A. Aggregate demand
Determinants of aggregate demand
Multiplier and crowding-out effects
B. Aggregate supply
Short-run and long-run analyses
Sticky versus flexible wages and prices
Determinants of aggregate supply
C. Macroeconomic equilibrium
Real output and price level
Short and long run
Chps. 28-31
Actual versus full-employment output
Key concepts:
Aggregate demand, multiplier, crowding out, aggregate supply—long and short run
Graphs:
Aggregate spending model
Aggregate demand/aggregate supply model
Assignments:
Quizzes
AS/AD problems
Practice with APC, APS, MPC, and MPS
The Magic of the Multiplier
Tools of Fiscal policy
Inflationary and Recession Gaps
Balanced Budget Multiplier
FRQs
Current Events: Aggregate Demand, Aggregate Supply, GDP, and Price level
Unit 4: Financial Sector (2.5 weeks)
Major topics:
A. Money, banking, and financial markets
Definition of financial assets: money, stocks, and bonds
Time value of money
Measures of money supply
Banks and creation of money
Money demand
Money market
Loanable funds market
B. Central banking and control of the money supply
Tools of central bank policy
Quantity theory of money—MV=PQ
Real versus nominal interest rates
Chps. 32-35
Key concepts:
Financial assets, time value of money, functions of money, M1, M2 and M3, demand and
supply of money, Federal Reserve system, money creation by banking system, money
multiplier, monetary policy (tight and easy), loanable funds market
Graphs:
Money market
Loanable funds market
Monetary policy money market transition mechanism
Assignments:
Quizzes
What’s all this about Ms?
Monetary equation of exchange
Multiple expansion of checkable deposits
Federal Reserve: monetary policy and macroeconomics
Real interest rates versus nominal interest rates
FRQs
Current events: Loanable funds, money market
Unit 5:
Inflation, Unemployment, and stabilization policies (3 weeks)
Chps. 27
Major topics:
A. Fiscal and monetary policies
Demand-side effects
Supply-side effects
Policy mix
Government deficits and debt
B. Inflation and unemployment
Types of inflation
Demand-pull inflation
Cost-push inflation
Phillips curve: short run versus long run
Role of expectations
Key concepts:
Short run aggregate supply curve, long run aggregate supply curve, Phillips curve, long
run vertical Phillips curve, supply side economics, public debt, crowding out, classical
(fixed) vs. Keynesian (flexible) view, monetarism, rational expectations view
Graphs:
Aggregate demand and supply model
Classical and Keynesian models
Phillips curve—short and long run
Laffer curve
Assignments:
Quizzes
Crowding out: a graphical representation
Graphing money and fiscal interactions
Short-run Phillips curve
FRQs
Current events: Classical or Keynesian model, Phillips curve
Unit 6: Economic growth and productivity (.5 of week)
Major topics:
A. Investment in human capital
B. Investment in physical capital
C. Research and development, and technological progress
D. Growth policy
Chp. 26, 36
Key concepts:
Economic growth, labor productivity, labor-force participation rate
Graphs:
Production possibility curve
Long run aggregate supply model
Assignments:
Quizzes
FRQs
Current event: long run aggregate supply
Unit 7: Open economy: international trade and finance (1 week)
Major topics:
A. Balance of payments and accounts
Balance of trade
Current account
Capital account
B. Foreign exchange market
Exchange rate determination
Currency appreciation and depreciation
C. Net exports and capital flows
D. Links to financial and goods markets
Ch 38-39
Key concepts:
Comparative advantage, terms of trade, trade barriers, trade organizations, balance of
payments, exchange rates—flexible and fixed
Graphs:
Production possibilities curve for trade
Exchange rates
Assignments:
Quizzes
Exchange rates
FRQs
Current event: exchange rates