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PRINCIPLES OF ECONOMICS 1 ECON 2301: Macroeconomics Professor: Dr. André V. Mollick Phone: (956) 316-7135; E-mail: [email protected] Office Hours: Daily: 11:00am – 12:00pm;

Summer I 2009 Office: BA 124A University of Texas-Pan American Dept. of Economics & Finance

COURSE DESCRIPTION AND GOALS This course, which does not have any prerequisites, introduces students to the basics of macroeconomics and to the building of an economist’s tool kit. We will define and analyze a host of macroeconomic variables and issues, such as: inflation, unemployment, GDP, interest rates, and economic growth. We will also discuss mainstream macroeconomic models commonly used to analyze the effects of both monetary and fiscal policies on macroeconomic variables. While based on textbook lectures, students are encouraged to develop applications to real world issues, particularly by keeping track of ongoing developments in the U.S. economy. For a description on how this course matches the Texas Higher Education Coordinating Board (THECB) exemplary objectives on social and behavioral sciences, please refer to: http://www.coba.panam.edu/ecofina/thecb.html For the Student Learning Outcomes of the Bachelor in Business Administration (BBA) or Bachelor of Arts (BA), Major in Economics, this course matches the competencies 3, 5, 6a, 6b, 6c, 6d, and 7c with exams and projects as the assessment measures adopted. Please refer to: http://www.coba.panam.edu/ecofina for further details. TEACHING METHODS This class will primarily be based on lectures by the professor. Reading assignments from the textbook, along with occasional homework problems and internet searches, will also be used to help students better understand the material. Students are expected to prepare for each class by reviewing their notes, working through assigned problems, and reading the assigned material. After each midterm exam, the following session will be dedicated to the exam’s solution and discussion of the material. It is your responsibility to attend these sessions and to keep track of what (and why) you did wrong in the mid-term exam. Please participate actively throughout the learning process. TEXTBOOK AND REQUIRED READING MATERIAL The required reading material for this course is Arnold’s textbook (ISBN 0-324-53832-4): Arnold, Roger A. Economics. 8th Edition. Thomson: South-Western. Mason, Ohio: 2008. Sixth or seventh editions are acceptable. As complement, use any Macro textbook published in the last 5 years. The WSJ is recommended for current business issues. ABOUT YOUR PROFESSOR Dr. André V. Mollick obtained his Ph.D. and M. Sc. in Economics from the University of Tsukuba in Japan in 1996 and his B.A. in Economics from the University of Brasilia (UnB) in Brazil. Prior to joining UTPA in the Fall of 2004, Dr. Mollick worked as faculty member at Monterrey’s ITESM for four and a half years. After completing his graduate school education, he worked in the private sector: for the Bank of Tokyo-Mitsubishi in Miami and for Sony Corporation in New York City. For details of his career and publication record, please refer to his personal homepage at: http://avmollick.googlepages.com/home STUDENTS WITH DISABILITIES If you have a disability and/or if you need special assistance, please contact the Office for Persons

2 with Disabilities, Emilia Ramirez-Schunior Hall, (ph: 316-7005) immediately for arrangements. PERFORMANCE MEASURES AND REWARDS Exams: The 3 mid-term exams are designed to cover blocks of lectured material and the final exam covers the whole material. Since the mid-term exams act as checkpoints of the learning process, you are strongly encouraged to take all mid-term exams. See the chart below for the specific dates. The class grade is determined by a weighted average of the two highest score midterm examinations, and a final examination (cumulative). Students will thus be able to drop the lowest grade midterm examination from the three midterm examinations taken. No make-up tests will be given. The weights are: midterm exams are assigned 30% each and the final is worth 40%. Homework: Homeworks will be assigned throughout the semester. These problems are designed to help students learn relevant material and will not be turned in for a grade. Reward Structure: At the end of the semester, the weighted average of points will determine the grade as follows: A 90 points or up B 80 - 89 points C 70 - 79 points D 60 - 69 points F 59 or fewer points There are some gray areas when students may be close to the next highest grade. Students with strong attendance, who participate in a constructive manner, and who consistently arrive to class on time will be given the benefit of the doubt in these borderline grades. Drop Policies: Institutional guidelines regarding drop requirements will be followed. This term July 3 is the last day to drop a course with a DR or W; please check the UTPA’s calendar for details. If you wish to drop the course, please follow UTPA’s policies and submit the (blue) drop slip for the professor’s signature. If you do not do so and do not attend midterms and the final exam, the final grade will be F. DR’s will only be issued to those who follow the rules on drop procedures. ATTENDANCE, TARDINESS, AND BEHAVIORAL POLICIES You are expected to attend class. Moreover, you are expected to be in class on time and should stay for the entire duration of the class. The professor reserves the right to take attendance. Students who are late will be counted as absent. Illnesses that do not require the aid of a licensed practicing physician, work, or car problems are not valid excuses to miss class. Moreover, tardy students and those who leave early are disruptive. Such students will lose the benefit of the doubt in case of borderline grades and will be counted as absent if they miss attendance when it is taken. Finally, when in class, please turn your cell-phones off. Do not call or write the professor with requests, such as: early disclosure of test grades or makeup exams. Use the office hours to address questions related to the learning process. You may request an appointment if the office hours do not fit into your schedule. Please try your very best not to visit the professor at times other than the office hours and special appointment windows. ACADEMIC MISCONDUCT Students at UTPA are expected to maintain the highest academic, ethnical, and professional standards of conduct. Any student found guilty of academic misconduct shall be subject to disciplinary actions. Academic misconduct includes, but is not limited to, cheating or assisting another student in cheating, plagiarism, unauthorized possession of course materials, and disrupting or obstructing any teaching environment. For more information, see Section 5 in UTPA’s Handbook of Operating Procedures (www.panam.edu/hop/).

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OUTLINE OF TOPICS AND EVENTS 1. Introduction to Supply and Demand Schedules 2. Macro Fundamentals: Measurement of Prices, Unemployment, GDP and Real GDP 3. Macroeconomic Stability, Instability, and Fiscal Policy 4. Money, the Economy, and Monetary Policy 5. Expectations Tentative

Topics

Dates Jun 8, 9

What Economics is About

Suggested

Reference to

Homeworks

Arnold (2008)

Ch.1: Q&P #3, 7 Chapter 1 & Ap. A Ap. A: Q&P#3,9

Jun 10

Economic

Activities:

Producing

and Working # 4 to 7

Chapter 2

Trading Jun 11, 12

Supply and Demand: Theory

Q&P

Chapter 3

#1, 10, 11, 15 Jun 15

Supply and Demand: Practice

Jun 16, 17

Exam I & Exam solution

Jun 18, 19

Macro

Measures

I:

Chapter 4 Chapters 1 to 4 Prices

Unemployment

and Working # 6a, 7, 10

Chapter 5

Jun 22

Macro Measures II: GDP and Real GDP

Working # 1, 10 Q & P #12

Chapter 6

Jun 23, 24

Aggregate Demand and Aggregate Supply

Chapter 7

Jun 25

The Self-Regulating Economy

Working # 2, 4 Q & P #5 Working # 2

Jun 26

Economic Instability

Working # 1

Chapter 9

Jun 29, 30

Exam II & Exam solution

Jul 1

The Federal Budget and Fiscal Policy

Jul 2

Chapter 8

Chapters 5 to 9 Working # 6, 8

Chapter 10

Money and Banking

Working # 6

Chapter 11

Jul 3

The Fed Res System

Working # 4

Chapter 12

Jul 6

Money and the Economy

Q & P #2

Chapter 13

Jul 7

Monetary Policy

Working # 5, 6

Chapter 14

Jul 8, 9

Exam III & Exam solution

Jul 10

Expectations Theory and the Economy

Jul 14

FINAL Exam

Chapters 10 to 14 Q & P #8

Chapter 15 All chapters

Notes: There is no class on July 13. Our Arnold (2008) textbook has two sorts of homeworks: Questions and Problems (Q & P) and Working with Numbers and Graphs (Working).