Download Scribner AP Macroeconomics Syllabus 2016-17

AP Macroeconomics Syllabus
Mae Jemison High School
2016-2017
Introduction:
Economics presents new learning with a specific set of terms and concepts to be addressed. Developing “an economic
way of thinking” is vital to understanding Economics coursework. This course will give you a thorough understanding at the
principles of macroeconomics, taking a look at the “big picture” of the economy. The focus will be economic measurement tools,
aggregate production and income, the use of fiscal and monetary policy, economic growth and international trade.
The AP Economics Course Description 2010 states: “The purpose of the AP course in Macroeconomics is to give students a
thorough understanding of the principles of economics that apply to an economic system as a whole. Such a course places particular
emphasis on the study of national income and price-level determination, and also develops students' familiarity with economic
performance measures, the financial sector, stabilization policies, economic growth, and international economics.”
Materials Needed Every Class:
1. Three-ringed binder
2. Lined notebook paper
3. Index cards
4. Index card box
5. Pen or Pencil
6. Laptop
7. Laptop Charger
Grading Policy:
-Exams: 70% of course grade
-8 Unit Tests all year each worth 10% (lowest test score will be dropped if Classwork is above 90%)
-Midterm and Final based on AP Exam graded separately
-Classwork: 20% of course grade
-Present and prepared for class with all materials: 50% of classwork grade (10% of course grade)
-Participating in all parts of the class each day: 50% of classwork grade (10% of course grade)
-Homework: 10% of course grade
-Vocabulary notecards will be checked daily
Resources:
Text: Margaret Ray and David Anderson. Krugman's Economics for AP. New York: Worth Publishers/BFW, 2011.
Video Series:
AC/DC Econ
FED Videos on Money and Inflation
Class Activities/Work:
 David Anderson. Economics by Example, New York: Worth Publishers, 2007.
 Margaret Ray and David Mayer. Strive for a 5 New York: Worth Publishers, 2011
 Exercises (Module AP Review, Take the Test: Multiple-Choice Questions, Take the Test: Free-Response) included
in textbook
 Lecture Notes and Class Activities included in Teacher Resource Binder or on Enhanced Teacher’s Resource CDROM
 Completion of selected graphing and interpretative exercises in Morton, John S. Advanced Placement Economics, 3rd
Ed. New York, NY: National Council on Economic Education, 2003 and additional exercises from the NCEE and other
sources as necessary.
 Quizzes, Unit Testing, Multiple Choice Questions and Free Response Practice
Course Outline
Unit 1
8-12% of AP
Basic Economic Concepts
I. Basic Economic Concepts *
A. Scarcity, choice and opportunity costs
B. Production possibilities curve
C. Comparative advantage, absolute advantage, specialization and exchange
D. Demand, supply and market equilibrium
AP Macroeconomics Syllabus
Coach Scribner
Krugman’s Economics for AP
Margaret Ray and David Anderson
E. Macroeconomic issues: business cycle, unemployment, inflation, and growth
* Taken from the AP Economics Course Description 2010
II. Student Objectives
A. Define the science of economics
B. Distinguish between opportunity cost, scarcity and trade-offs.
C. Distinguish between macroeconomics and microeconomics
D. List the three basic economic questions
E. Define comparative advantage
F. Using both graphical and table analysis, show the benefit of employing comparative advantage
G. Use a production possibilities curve to demonstrate opportunity cost and growth
H. List the determinants of demand and supply curves
I. Recognize which factors will cause demand curves or supply curves to shift
J. Distinguish between changes in quantity demanded versus a change in demand
K. Distinguish between changes in quantity supplied versus a change in supply
L. Determine effects on price and quantity when equilibrium changes
M. Describe the macroeconomic performance in the United States and other countries—GDP,
inflation, unemployment and other indicators
III. Graphs and Diagrams to be mastered
A. Production Possibility Curve
B. Demand and Supply Equilibrium
C. Business Cycle
IV. Key Terms Section 1 p. 32; Section 2 p. 96 (Textbook)
V. Supplemental Activity
A. Economics by Example: David Anderson
Chapter 1: What’s to Love About Economics
Chapter 3: The Coffee Market’s Hot; Why are Bean Prices Not?
B. Strive for a 5: Ray and Mayer
Module 1 Activities p. 2-6
Module 2 Activities p. 7-10
Module 3 Activities p. 11-13
Module 4 Activities p. 14-16
Section 2 Before You Take the Test
Featured Graph: Production Possibility Curve p. 16-18
Problems p. 18-23
Review Questions p. 24-27
C. Strive for a 5: Ray and Mayer
Module 5 Activities p. 36-40
Module 6 Activities p. 41-44
Module 7 Activities p. 45-47
Section 2 Before You Take the Test
Featured Graph: Demand/Supply Curves p. 54-56
Problems p. 56-59 (1-6 only)
Review Questions p. 65-66 (1-11 only)
Section 1
Opening: Section 1
Module 1: The Study of Economics
Module 2: Introduction to Macroeconomics
Module 3: The Production Possibilities Curve Model
Module 4: Comparative Advantage and Trade
Section 1 Summary
Section 1 Appendix: Graphs in Economics
Section 2
Opening: Section 2
Module 5: Introduction to Demand
Module 6: Supply and Equilibrium
Module 7: Changes in Equilibrium
Module 8: Supply and Demand Controls (Ceilings and Floors)
Module 9: Supply and Demand Quantity Controls
AP Macroeconomics Syllabus
Coach Scribner
Textbooks pages
p. 1
p. 1-9
p. 10-15
p. 16-22
p. 23-30
p. 31-33
p. 34-45
p. 47
p. 48-58
p. 59-70
p. 71-76
p. 77-88
p. 88-94
Krugman’s Economics for AP
Margaret Ray and David Anderson
Section 2 Summary
Unit 2
12-16% of AP
p. 94-99
Measurement of Economic Performance
I. Measurement of Economic Performance*
A. National income accounts
1. Circular flow
2. Gross domestic product
3. Components of gross domestic product
4. Real versus nominal gross domestic product
B. Inflation measurement and adjustment
1. Price indices
2. Nominal and real values
3. Costs of inflation
C. Unemployment
1. Definition and measurement
2. Types of unemployment
3. Natural rate of unemployment
* Taken from the AP Economics Course Description 2010
II. Student Objectives
A. Define Gross Domestic Product by expenditure and income approaches
B. Distinguish between nominal GDP and real GDP
C. Explain the limitations of GDP measures
D. Define unemployment; list sources and types
E. Define labor force participation rate
F. Define the full employment level of GDP
G. Distinguish between actual and potential GDP
H. Explain the calculation of price indices—GDP deflator, CPI, PPI
I. Use price indices to calculate real wages and real interest rates
III. Graphs and Diagrams to be mastered
A. Circular Flow Diagram (simple and expanded)
B. Effect of Minimum Wage on Labor Market
IV. Formulas to be mastered
A. Gross Domestic Product (GDP) = Consumption Spending + Government Spending +
Investment Spending +Net Export Spending (GDP=C+G+I+Xn)
B. Disposable Income (DI) = Personal Income—Taxes + Transfers
C. Per Capita GDP
D. Calculation of Real GDP using an Index
E. Labor Force Participation Rate
F. Unemployment Rate
G. Natural Rate of Unemployment
H. Price Indexing and Consumer Price Index, Producer Price Index
V. Key Terms
Section 3 p. 150 (Textbook)
VI. Supplemental Activity
A. Economics by Example: David Anderson
Chapter 21: Why Do We Neglect Leisure and Cheer for Divorce?
B. Strive for a 5: Ray and Mayer
Module 10 Activities p. 80-84
Module 11 Activities p. 85-87
Module 12 Activities p. 88-90
Module 13 Activities p. 91-93
Module 14 Activities p. 94-96
Module 15 Activities p. 97-99
Section 3 Before You Take the Test
Featured Graph: Circular Flow Model p. 100-101
Problems p. 102-108
Review Questions p. 109-112
AP Macroeconomics Syllabus
Coach Scribner
Krugman’s Economics for AP
Margaret Ray and David Anderson
Section 3
Opening: Section 3
Module 10: The Circular Flow and GDP
Module 11: Interpreting RGDP
Module 12: The Meaning and Calculation of Unemployment
Module 13: The Causes and Categories of Unemployment
Module 14: Inflation: An Overview
Module 15: The Measurement and Calculation of Inflation
Section 3 Summary
Unit 3
10-15% of AP
Textbooks pages
p. 101
p, 102-111
p. 112-117
p, 118-125
p. 126-133
p. 134-141
p. 142-148
p. 148-155
National Income and Price Determination
I. National Income and Price Determination *
A. Aggregate demand
1. Determinants of aggregate demand
2. Multiplier and crowding-out effects
B. Aggregate supply
1. Short-run and long-run analyses
2. Sticky versus flexible wages and prices
3. Determinants of aggregate supply
C. Macroeconomic equilibrium
1. Real output and price level
2. Short and long run
3. Actual versus full-employment output
4. Economic fluctuations
* Taken from the AP Economics Course Description 2010
II. Student objectives
A. List the determinants of aggregate demand
B. Distinguish between changes in AD and a change in price level causing movement along the AD
curve
C. List reasons why the aggregate demand curve is down sloping
D. List the determinants of aggregate supply
E. Distinguish between changes in AS and a change in price level causing movement along the AS
curve
F. Explain and demonstrate the shape of the aggregate supply curve in the short and long run; define
and show the full-employment level of output (Qf)
G. Determine the importance of the shape of the AS curve on the effects of change in the AD curve
H. Determine equilibrium using an aggregate demand/aggregate supply graph and show the effects on
price level and Real GDP when equilibrium changes in both the long and the short run
I. Given data, determine the size of the spending multiplier and assess is impact on aggregate
demand
J. Define Fiscal Policy—discretionary and non-discretionary
K. Define and measure the effect of built-in stabilizers on the economy
L. Using AD/AS analysis, show the effect on price level and RDGP of changes in fiscal policy
M. Define the balance budget multiplier
N. Distinguish between sticky-price and sticky-wage models and flexible price and wage models;
identify the effect of these differences on the AS curve
III. Graphs and Diagrams to be mastered
A. Aggregate Demand/Aggregate Supply Model (Short-run and Long-run)
B. Potential vs. Actual Output
C. Recessionary Gap and Inflationary Gap
D. Sources of Tax Revenue and Government Spending in US
E. Expansionary and Contractionary Fiscal Policy effects
IV. Formulas to be mastered
A. Marginal Propensity to Consume (MPC)
AP Macroeconomics Syllabus
Coach Scribner
Krugman’s Economics for AP
Margaret Ray and David Anderson
B. Marginal Propensity to Save (MPS)
C. Spending Multiplier 1/MPS
V. Key Terms
Section 4 p. 216 (Textbook)
VI. Supplemental Activity
A.
Economics by Example: David Anderson
Chapter 25: How Much Debt is Too Much?
B.
Strive for a 5: Ray and Mayer
Module 16 Activities p.122-125
Module 17 Activities p. 126-128
Module 18 Activities p. 129-131
Module 19 Activities p. 132-135
Module 20 Activities p. 136-138
Module 21 Activities p. 139-141
Section 4 Before You Take the Test
Featured Graph: Aggregate Demand-Aggregate Supply Model p. 141-144
Problems p. 144-150
Review Questions p. 150-153
Section 4
Opening: Section 4
Module 16: Income and Expenditures
Module 17: AD: Introduction and Determinants
Module 18: AS: Introduction and Determinants
Module 19: Equilibrium in the AD/AS Model
Module 20: Economic Policy and the AD/AS Model
Module 21: Fiscal Policy and the Multiplier
Section 4 Summary
Unit 4
15-20% of AP
Textbooks pages
p. 157
p. 158-171
p. 172-178
p. 179-189
p. 190-198
p. 199-208
p. 209-214
p. 215-219
Financial Sector
I. Financial Sector *
A. Money, banking and financial markets
1. Definition of financial assets: money, stocks, bonds
2. Time value of money (present and future value)
3. Measures of money supply
4. Banks and creation of money
5. Money demand
6. Money market
7. Loanable funds market
B. Central bank and control of the money supply
1. Tools of central bank policy
2. Quantity theory of money
3. Real versus nominal interest rates
* Taken from the AP Economics Course Description 2010
II. Student Objectives
A. Define and list factors influencing money demand
B. Define money supply
C. Explain the financial system and define various types of financial assets
D. Define the Savings — Investment Spending Identity
E. Demonstrate understanding of the time value of money
F. Define a fractional banking system
G. Explain the role of the Federal Reserve System in the economy
H. Identify and examine the tools of central bank policy and their impact on money supply and
interest rates
I. Describe the process of money creation and multiple-deposit expansion
J. Given data, determine the size of the money multiplier and assess its impact on the money supply
K. Distinguish between nominal and real interest rates
III. Graphs and Diagrams to be mastered
A. Money Market: Demand and Supply of Money and Equilibrium
AP Macroeconomics Syllabus
Coach Scribner
Krugman’s Economics for AP
Margaret Ray and David Anderson
B. Loanble Funds Market Demand and Supply of Loanable Funds and Equilibrium
C. TED spread
IV. Formulas to be mastered
A. Money Supply measurements (M1 and M2)
B. Present Value
C. Money Creation by the banking system
D. Money Multiplier
V. Key Terms
Section 5 p. 290 (Textbook)
VI. Supplemental Activity
A. Economics by Example: David Anderson
Chapter 22: Does the Money Supply Matter?
B. Strive for a 5: Ray and Mayer
Module 22 Activities p. 164-167
Module 23 Activities p. 169-171
Module 24 Activities p. 172-173
Module 25 Activities p. 174-177
Module 26 Activities p. 178-180
Module 27 Activities p. 181-183
Module 28 Activities p. 184-186
Module 29 Activities p. 187-189
Section 5 Before You Take the Test
Featured Graph: Money Market/Loanable Funds Market p. 189-190
Problems p. 191-197
Review Questions p. 197-201
C. Favorite Ways to Learn Economics: Anderson and Chasey
Chapter 10 Macroeconomic Indicators
Class Room Experiments 10A and 10B
Problem Sets 10.1-10.2
Chapter 9 Macroeconomic Indicators
Class Room Experiments 9A
Problem Sets 9.1
Section 5
Textbooks pages
Opening Section 5
p. 221
Module 22: Saving, Investment and the Financial System
p. 222-230
Module 23: The Definition and Measurement of Money
p. 231-236
Module 24: The Time Value of Money
p. 237-242
Module 25: Banking and Money Creation
p. 243-252
Module 26: The Fed. History and Structure
p. 253-261
Module 27: The Fed. Monetary Policy
p. 262-267
Module 28: The Money Market
p. 268-276
Module 29: The Market for Loanable Funds
p. 277-287
Section 5 Summary
p. 288-293
Unit 5
20-30% of AP
Inflation, Unemployment and Stabilization Policies
I. Inflation, Unemployment, and Stabilization Policies *
A. Fiscal and monetary policies
1. Demand-side effects
2. Supply-side effects
3. Policy mix
4. Government deficits and debt
B. Inflation and unemployment
1. Types of inflation
a. Demand-pull inflation
b. Cost-push inflation
2. The Phillips curve: short run versus long run
3. Role of expectations
* Taken from the AP Economics Course Description 2010
II. Student objectives
A. Assess the effect of fiscal and monetary policy on real output, price level and the level of
AP Macroeconomics Syllabus
Krugman’s Economics for AP
Coach Scribner
Margaret Ray and David Anderson
employment in the long and short run
B. Gain understanding of how an economy responds to a short-run shock and adjusts in the long
run in the absence of any public policy actions
C. Examine the economic effects of government deficit budgets including “crowding out”
D. Consider issues surrounding the size and burden of the national debt
E. Gain understanding of inflation-unemployment tradeoffs using short and long run Phillips
curve analysis
F. Show the causes of inflation on an AD/AS model
G. Define the quantity theory of money
H. Speculate on the role of inflationary expectations on price level and output
III. Graphs and Diagrams to be mastered
A. Money Market Model: Effect of policy actions on interest rate
B. Money Market Model: Setting the Federal Funds rate
C. Money Market Transition Mechanism: Short run and long run effects of expansionary and
contractionary policy changes
D. Tracking Monetary Policy Using the Output Gap, Inflation and the Taylor Rule
E. Long-Run Determination of the Interest Rate
F. Classical Model of Price Level
G. Cyclical Unemployment and the Output Gap
H. Short Run Phillips Curve
I. Short Run Phillips Curve showing Supply Shocks; showing expected inflation
J. Long Run Phillips Curve and NAIRU (non-accelerating rate of unemployment)
K. The Fischer Effect
L. Fiscal Policy with a Fixed Money Supply
IV. Key Terms
Section 6 p. 362 (Textbook)
VI. Supplemental Activity
A. Economics by Example: David Anderson
Ch. 19: Will Technology Put Us All Out of Work?
B. Strive for a 5: Ray and Mayer
Module 30 Activities p. 214-216
Module 31 Activities p. 217-219
Module 32 Activities p. 220-222
Module 33 Activities p. 223-225
Module 34 Activities p. 226-229
Module 35 Activities p. 230-233
Module 36 Activities p. 234-235
Section 6 Before You Take the Test
Featured Graph: The Phillips Curve p. 235-236
Problems p. 236-242
Review Questions p. 242-247
Section 6
Opening Section 6
Module 30: Long Run Implications of Fiscal Policy:
Deficits and the Public Debt
Module 31: Monetary Policy and the interest Rate
Module 32: Money, Output and Prices in the Long Run
Module 33: Types of Inflation, Disinflation and Deflation
Module 34: Inflation and Unemployment: The Phillips Curve
Module 35: History and Alternative Views of Macroeconomics
Module 36: The Modern Macroeconomic Consensus
Section 6 Summary
Unit 6
5-10% of AP
Textbooks pages
p. 295
p. 296-306
p. 307-314
p. 315-320
p. 321-330
p. 331-342
p. 343-354
p. 355-360
p. 361-365
Economic Growth and Productivity
I. Economic Growth and Productivity *
A. Investment in human capital
B. Investment in physical capital
C. Research and development, and technological progress
D. Growth policy
AP Macroeconomics Syllabus
Coach Scribner
Krugman’s Economics for AP
Margaret Ray and David Anderson
* Taken from the AP Economics Course Description 2010
II. Student Objectives
A. Define economic growth and list the factors that stimulate growth
B. Assess the role of productivity in raising real output and standard of living
C. Suggest how public policies stimulate economic growth
III. Graphs and Diagrams to be mastered
A. Trade-off Between Investment and Consumer Goods
B. Short Run movements along Long Run Aggregate Supply
C. Long Run Aggregate Supply Curve and Economic Growth
IV. Formulas to be mastered
A. Real GDP per Capita
B. Rule of 70
C. Aggregate Production Function
V. Key Terms
Section 7 p. 45 (Textbook)
VI. Supplemental Activity
A. Economics by Example: David Anderson
Chapter 28: Why Are Some Nations Rich and Others Poor?
B. Strive for a 5: Ray and Mayer
Module 37 Activities p. 260-262
Module 38 Activities p. 263-265
Module 39 Activities p. 266-268
Module 40 Activities p. 269-270
Section 7 Before You Take the Test
Featured Graph: Long run Growth-PPC and AD/AS p. 271
Problems p. 271-275
Review Questions p. 275-277
Section 7
Opening Section 7
Module 37: Long Run Economic Growth
Module 38: Productivity and Growth
Module 39: Growth Policy: Why Economic Growth Rates Differ
Module 40: Economic Growth in Macroeconomic Models
Section 7 Summary
Unit 7
10-15% of AP
Textbooks pages
p. 367
p. 368-375
p. 376-386
p. 387-397
p. 398-404
p. 404-408
Open Economy: International Trade and Finance
I. Open Economy: International Trade and Finance *
A. Balance of Payments accounts
1. Balance of trade
2. Current account
3. Capital account
B. Foreign exchange market
1. Demand for and supply of foreign exchange
2. Exchange rate determination
3. Currency appreciation and depreciation
C. Net exports and capital flows
D. Links to financial and goods markets
* Taken from the AP Economics Course Description 2010
II. Student objectives
A. Explain how the balance of payments accounts are recorded
B. Explain the effect of trade restrictions
C. List the factors that influence equilibrium foreign exchange rates
D. Using demand/supply analysis, show how market forces and public policy affect currency
demand and currency supply
E. Define currency appreciation and depreciation and relate to graphical analysis
F. State the effects of appreciation and depreciation on a country’s net exports
G. Understand how changes in net exports and capital flows affect financial and goods markets
III. Graphs and Diagrams to be mastered
A. Balance of Payments Accounts
B. International Capital Flows
AP Macroeconomics Syllabus
Krugman’s Economics for AP
Coach Scribner
Margaret Ray and David Anderson
C. Foreign Exchange Markets
D. Fixed Exchange Markets and Market Intervention
E. Monetary Policy Effects and the Exchange Rate
IV. Key Terms Section 8 p. 453 (Textbook)
V. Supplemental Activities
A. Economics by Example: David Anderson
Chapter 27: Is Globalization A Bad Word?
B. Strive for a 5: Ray and Mayer
Module 41 Activities p. 284-286
Module 42 Activities p. 287-289
Module 43 Activities p. 290-292
Module 44 Activities p. 293-294
Module 45 Activities p. 295-296
Section 8 Before You Take the Test
Featured Graph: Foreign Exchange Model p. 296-297
Problems p. 297-305
Review Questions p. 305-309
Section 8
Textbooks pages
Opening Section 8
Module 41: Capital Flows and the Balance of Payments
Module 42: The Foreign Exchange Market
Module 43: Exchange Rate Policy
Module 44: Exchange Rates and Macroeconomic Policy
Module 45: Putting it All Together
Section 8 Summary
p. 409
p. 410-420
p. 421-430
p. 437-442
p. 443-451
p. 443-451
p. 452-455
Assessment
There will be 8 Unit Tests and one or more quizzes during each unit. Within each unit, Free Response Questions and
Multiple Choice Questions will be used for reinforcement and practice. Students will be informally assessed with other
instruments of assessment such as homework assignments, on-line assignments, and group work in the classroom.
It is expected that all students will take the AP Macroeconomics exam scheduled in May. Review sessions will be held
in April and will include test taking strategy and practice tests as well as content review.
AP Macroeconomics Syllabus
Coach Scribner
Krugman’s Economics for AP
Margaret Ray and David Anderson