Introduction to Economics (Macro)
Econ. 1023

COURSE OBJECTIVES:

Two elementary facts face the world and every individual in it: limited resources and relatively unlimited wants. The combination of these two facts forces all of us to make choices that will give us the maximum satisfaction. Economics is a social science that uses scientific methods in studying the economic choices that people (as individuals, as businesses, or as government) make, and the consequences of those choices. Economics is thus part of everyday life. Every day, media is full of news stories on economic problems. In an introductory course in economics, we learn the economic way of thinking (the language of economists) in dealing with problems facing individuals, communities, businesses, and governments. Often, forces affecting the behaviour of a single household/business are different from the forces affecting the economy as a whole. Economists, therefore, for analytical convenience, divide the subject matter into micro (meaning small) and macro (meaning large) economics. However, you can study micro and macro in either sequence, or together. The recent drive towards globalization has interesting implications for both micro and macro issues.

In the micro part of this course completed last term, you gained an understanding of how the households and businesses, as individual decision makers, arrive at their decisions that maximize their own interests, and the role of the government when markets fail to achieve efficient allocation of resources. In the macro part that we study this term, we examine consequences of the behaviour of all households and all businesses taken together, including their interactions, in terms of overall levels of various economic activities. In macro therefore we examine structure, behaviour and performance of the economy as a whole in terms of variables such as aggregate output of all goods and services, present and future living standards, unemployment, inflation, budget deficit, government debt, interest rate, exchange rate, etc. . In addition, as in micro, we shall examine various economic policies pursued by the government for achieving better economic conditions for all residents.

TEXTBOOK:

N. Gregory Mankiw, et al, Principles of Macroeconomics, Harcourt Brace & Company,1999, Chaps. 10-22.

N. Gregory Mankiw, et al, Study Guide to accompany Principles of Macroeconomics, Chaps 10-22.

EVALUATION:

Three class tests 30%
Weekly News Reports (best ten) 10%
Attendance and Class Participation: 10%
Final exam (all chapters): 50%

ORGANIZATION:

I strongly recommend that you buy the textbook and the Study Guide noted above. Monday and Wednesday classes will normally be held in lecture format. Friday classes will normally be held in discussion format: discussing current economic events, class tests, and questions relating to the material covered during the preceding classes. Each Friday, you are expected to submit a write-up of 150 to 200 words (typed, and in your own words) on major economic events during the past week, and discuss them in class. Though I will not assign a particular grade to your news summaries, a poor quality summary will not receive any mark. If you enjoy research and writing, I welcome you to write an essay either on "the Current State and Prospects of the Canadian Economy" or on "An Analysis of the Federal Budget, 2001". The essay (due March 19) will be worth 20% of your final mark, leaving 30% for the final exam. Late news summaries or essays will not be accepted. If you miss a class test for a valid reason, your test marks will be added to your final exam. Your attendance in class is important for a good grasp of the material. I will check your attendance randomly. The course has been designed in a multimedia format including the use of computers and audio-visual equipment for easy learning, and to bring economics alive to the classroom.

Welcome to Introduction to Economics (Macro)!


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