Economics 201 (Principles of Macroeconomics)
Fall 1999
Instructor: Dr. Terry Rephann
Office: College Center, Room 160
Date: R 6:00 PM -8:45 PM
Place: Allegany College, Bedford County Campus
Office hours: by appointment
Office phone: (301)  784-5207
Office fax: (301) 784-5012

** Please note: Under extenuating circumstances, the instructor has the right to change any course provisions or requirements during the semester.

I. Purpose

Catalog Description: Offered first semester. Three hours lecture and discussion a week.

An introduction to basic economic concepts regarding demand and supply, comparative economic systems, and national accounts, employment theory, and fiscal and monetary policy, emphasizing the interplay of households, business, and government in various economic situations. 3 semester hours.

Course Objectives: This course will help to provide the student with sufficient background information to enable him/her to understand the complex structure of the U.S. economy, how it functions in an increasingly interdependent world, and how different economic theories are applied in "managing" such major economic problems as inflation, unemployment, and productivity growth. The course approaches the problems of production, exchange, and consumption of goods and services from the viewpoint of society as a whole, rather than from that of an individual or firm.

The specific course objectives are:

  1. To increase studentsí awareness of major macroeconomic problems and issues.
  2. To familiarize students with the tools and analysis used by economists in measuring inflation, unemployment, etc.
  3. To familiarize students with various economic theories and schools of thought. The tension between varying suggestions for managing the economy through fiscal and monetary policy will be emphasized.
  4. Finally, to equip students with the basic knowledge needed to understand economic reports, statistics, and citations.

II. Course Policies

A. Attendance: Students are recommended to attend classes regularly because exams will be based on the material presented in class as well as assigned readings. In addition, homework problems will be collected every class period, and late homework will not be accepted. Students should strive to arrive in the room(s) before class begins.

B. Class Participation: Participation is not required, but it is strongly recommended.

C. Grading: Grades will be based upon the student's performance on four exams valued at 100 points each and homework assignments worth a total of 100 points. The grading scale is as follows: 90-100%=A, 80-89%=B, 70-79%=C, 60-69%=D, and 0-59%=F.

D. Extra Credit: No extra credit will be offered.

E. Tutoring, extra help sessions: Contact the instructor or the Instructional Assistance Center. I generally will be available 10-20 minutes before the class begins for consultation. If a student needs additional help, please contact me about scheduling another time.

F. Make-up Test Policy: If a student is unable to take an exam at its regularly scheduled time, he or she will be given a make-up exam only if he or she contacts me before the regularly scheduled exam and has a legitimate excuse that is substantiated. For athletes and club members who are on the road at times, a written request from the coach or faculty advisor is required in advance. Make-up exams will be given during the final week of class (and, needless to say, the make-up exam will be different from the regular exam).

G. Assignment Format and Deadlines: Instructions and deadlines will be announced in class and distributed to the class.

H. Plagiarism and Cheating: Cheating and plagiarism will be punished severely. Please consult with the Student Handbook regarding College guidelines.

III. Course Requirements

A. Required Text: Baumol, William J. and Alan S. Blinder. 1998. Macroeconomics: Principles and Policy. 7th Edition. Harcourt Brace & Co.

B. Course Outline:

UNIT I. Introduction to Macroeconomics

A. Introduction

Required Reading: Baumol and Blinder, Chapter 1.

Web Sources:  The Economist 
                           The Wall Street Journal
                           Resources for Economists on the Internet

B. Mathematical primer

Required Reading: Baumol and Blinder, Appendix to Chapter 1.

C. Description of the U.S. Economy

Required Reading: Baumol and Blinder, Chapter 2.

Web Sources:    WWW.Economic-Indicators.Com
                             Bureau of Economic Analysis
                             U.S. Census Bureau

D. Scarcity and Choice

Required Reading: Baumol and Blinder, Chapter 3.

E. Supply and Demand

Required Reading: Baumol and Blinder, Chapter 4.

F. Macroeconomics: Contemporary Problems and Issues

Required Reading: Baumol and Blinder, Chapters 5 and 6.

UNIT II. Macroeconomic Models

A. Circular Flow Model

Required Reading: Baumol and Blinder, Chapter 7 (pp. 141-146).

B. Models of Consumption, Investment, and Net Exports

Required Reading: Baumol and Blinder, Chapter 7 (pp. 146-158), Chapter 8 (pp.165-170).

C. Income/Expenditure (Keynesian Cross) Model

Required Reading: Baumol and Blinder, Chapter 8 (pp. 170-186) and Chapter 9 (pp. 187-197).

D. Aggregate Demand

Required Reading: Review Baumol and Blinder, Chapter 8 (pp. 176-178) and Chapter 9 (pp.197-199).

E. Aggregate Supply

Required Reading: Baumol and Blinder, Chapter 10 (pp. 205-210), Chapter 14 (pp. 308-311).

F. Aggregate Demand and Aggregate Supply Model

Required Reading: Baumol and Blinder, Chapter 10 (pp. 210-224).

UNIT III. Money and Banking

A. Introduction to Money and the Banking System

Required Reading: Baumol and Blinder, Chapter 12.

Web Sources:    Board of Governors of the Federal Reserve System
                             Federal Deposit Insurance Corporation
                             U.S. Treasury Department  
  1. Money and the Federal Reserve

Required Reading: Baumol and Blinder, Chapter 13 (pp. 273-282).

C. Money Supply and Money Demand

Required Reading: Baumol and Blinder, Chapter 13 (pp. 282-293).

D. The Debate over Monetary Policy

Required Reading: Baumol and Blinder, Chapter 14 (pp. 295-308).

UNIT IV. Macroeconomic Problems and Policy

A. Government Stabilization Policies: Fiscal , Monetary, and Supply Side Policy

Required Reading: Baumol and Blinder, Chapter 11 and Chapter 14 (pp. 311-319).

Web Sources: Conference Board Leading Economic Indicators 
                          WEFA Group

B. Macroeconomic Schools of Thought (Classical, Rational Expectations, Monetarist, Supply-siders, Keynesian, Neo-Keynesian)

Required Reading: TBA

C. Budget Deficits and Federal Debt

Required Reading: Baumol and Blinder, Chapter 15.

Web Sources: National Budget Simulation

D. Inflation and Unemployment

Required Reading: Baumol and Blinder, Chapter 16.

Web Sources: Bureau of Labor Statistics

Preliminary Schedule:

9/2/1999 Intro, I.A, I.B

9/9/1999 I.C, I.D

9/16/1999 I.E, I.F

9/23/1999 Test I (covers Unit I), II.A, II.B

9/30/1999 II.B, II.C, II.D

10/7/1999 IID, IIE, IIF

10/14/1999 TestII (covers Unit II), IIIA

10/21/1999 IIIB, IIIC

10/28/1999 IIIC, IIID

11/4/1999 Test III (covers Unit III), IVA

11/11/1999 IVA, IVB

11/18/1999 IVB, IVC

11/25/1999 No class (Thanksgiving Break)

12/2/1999 IVD

12/9/1999 Test IV (covers Unit IV)

C. Library Assignments.

The assignments alluded to in section II C. may require use of the library.

D. Additional Required Student Reading Assignments.

Additional short readings may be distributed to the class if time permits. The instructor will notify students if they are responsible for the material contained therein.

E. Recommended and Optional Readings.

These readings are listed in the course outline above.

F. Supplemental Learning Resources. Computer software demonstrations, World Wide Web demonstrations, and multimedia presentations may be used in this class.

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