Approved by Faculty Senate.

University Studies Course Approval

Department or Program: Economics
Course Number: 202
Semester Hours: 3
Frequency of Offering: Every Semester
Course Title: Principles of Macroeconomics

Catalog Description: National income analysis; aggregate demand and supply; money and banking;
business cycles; monetary and fiscal policy.

This is an existing course previously approved by A2C2: Yes

This is a new course proposal: No

Department Contact Person: Gabriel Manrique Email: manrique@winona.edu

University Studies Approval is requested in: The Arts and Sciences Core - Social Science

Attachments: The attached sample syllabus explains what is typically covered in this course. It also
points out in which parts of the course the seven outcomes for social science courses (a-g) are addressed.
The syllabus is included in this application for purposes of illustration. Each faculty member is still responsible
for his/her own course syllabus.

As required in points 1 and 2 of the approval process, the following address the seven outcomes listed for
Social Science courses and documents course content and learning activities relevant to the course outcomes:

  1. understand humans as individuals and parts of larger social systems

    Economic decisions are assumed to be made by the individual who is treated, in macroeconomics, as a
    member of a household. Such households make their own consumption and savings decisions. The
    individual also makes economic decisions as part of business entities. Such business entities make their
    own decisions regarding production and investment. But individuals (households) as well as firms do not
    operate in a societal vacuum. Indeed, macroeconomics uses the circular flow model to illustrate the various
    ways individuals are connected to others in society through the operation of markets, the participation of
    government, and the international sector. Students are expected to understand the multiple roles that they
    play in the society - as buyers of goods and services, as providers of resources, as tax payers, and as members
    of a global society through the open economy.

  2. understand the historical context of the social sciences

    Macroeconomics emphasizes the evolution of economic models, theories and policies through time and in
    reaction to the problems of different time periods. As such the student begins with the study of classical
    economics, then progresses through Keynesian economics, monetarist economic models, and other schools
    of economic thought. Included in the subject matter is the Great Depression as well as the business cycles that
    the economy has gone through. Students are also made to understand that economics as social science is constantly evolving. New models and economic theories are always being developed and tested and are eventually used to
    analyze more and more of human behavior and social interactions.

  3. identify problems and frame research questions relating to humans and their experience

    The common concerns of modern societies that include unemployment, inflation, economic growth and
    improvements in the standard of living, general welfare, etc. are the areas that form the core of this
    macroeconomics course. As part of their learning, students are encouraged to be up to date with current
    economic information and the significance of such information. Once students understand the data that reflect
    the economic conditions that humans face, they proceed to a study of how such conditions come about and
    how changes may be effected through economic policies. For example, students are expected to learn how the Consumer Price Index is developed, how it is used to measure inflation rates, how inflation affects various
    segments of society, what causes inflation, and what policies are available, based on economic models and
    theories, to prevent or tame inflation.

  4. become familiar with the process of theory-building and theoretical frameworks
    used by the social sciences

    Students are expected to understand that there is a difference between normative economics and
    positive economics; that economic models are developed as simplifications of complex realities;
    that models are used to study what are considered important relationships in society; and that from
    these theoretical frameworks, important policies can be derived. Students are made to go through a
    process of understanding first economic data and identifying economic problems as shown in the
    data - for example, unemployment problems or the threat of inflation, or the lack of economic growth.
    These problems are then analyzed using models developed by economists. Students are asked to learn
    he differences between exogenous and endogenous variables as they study economic models. From this,
    predictions about economic outcomes as well as fiscal and monetary policy suggestions are derived.

  5. understand the research methods used in the social sciences

    The research tool kit of economics includes a number of methods including the use of the census, surveys,
    observation, tabulation, etc. Students are exposed to some of the numerous time series data that are compiled
    by both public and private agencies about the economy. Students become familiar with the data compiled by
    the Bureau of Labor of Statistics, the Department of Commerce, the Federal Reserve Board, the National
    Association of Manufacturers, the National Bureau of Economic Research, etc. The extensive use of graphs as representations of the economy helps the student analyze various economic problems, relationships, and policies.
    While econometric techniques are not covered in this principles of macroeconomics course, students are exposed
    to some of the algebraic equations that capture the essence of important economic relationships such as the
    consumption function, the savings function, and the money demand function.

  6. describe and detail discipline-specific knowledge and its applications

    National income accounts provide much of the discipline specific data that students must learn. This includes
    data on the Gross Domestic Product, unemployment, inflation, the money supply, interest rates, etc. The models
    for analysis of the data and economic problems are also discipline specific such as aggregate supply and aggregate demand, the aggregate expenditure models, circular flows in the economy, money demand functions, the
    determination of interest rates, etc. Fiscal policy and monetary policy, and the tools associated with these policies
    are also covered extensively. These are specific to economics and are at the core of the application of economic knowledge to the human condition.

  7. understand differences among, and commonalities across humans and their experiences,
    as tied to such variables as gender, race, socioeconomic status, etc.
    The circular flow perhaps best demonstrates how macroeconomics helps students understand the
    commonality of experiences among human beings. As part of the same resource, product, and financial
    markets, all individuals share common ground. However, macroeconomics also teaches about the
    differences in the human experience. For example, students work with unemployment data that show how unemployment affects segments of society differently depending on gender, race, and age group. Data on
    nflation rates and personal income also demonstrate to students the differences among social groups, among
    countries, and across generations. The study of national income accounts, in particular the Gross Domestic
    Product, also includes segments on social welfare. The study of fiscal policy is an important part of macroeconomics. And through this, students have the opportunity to explore the impact of policy decisions regarding spending and
    taxation on the various segments of society.

(Sample Syllabus)

ECON 202 - Principles of Macroeconomics
Instructor:
Office:                 Phone:
Office Hours:     e-mail:
Texts: Economics, by Case and Fair
                The Wall Street Journal (highly recommended)
                The Economist (highly recommended)

Objectives:
        To introduce the student to the basic concepts of economics, the economic way of thinking, and the
economists' methods of analysis. The course will focus on the behavior of aggregate variables in the economy
as well as the relationships among these variables. Every attempt will be made to apply economic analysis to
current events and important national issues.

Expectations:

1. That the student has read the assigned segments of the book before coming to class.
        Class periods should be utilized to clarify course material and to ask questions of the
         instructor. They are not meant to be the student's first encounter with the subject matter.

2. That the student is knowledgeable in current events. The instructor will be using material
        from the Wall Street Journal related to current statistics about the economy, and the
        economicpolicies under consideration by the Clinton administration, the US Congress,
        and the FED. Since this is a presidential election year, material from the respective campaigns
        relevant to economics will also be included in the course. The student is responsible for keeping
        up-to-date with current issues particularly as they relate to the economy. Questions on current
        events will be included in the tests.

3. That the student has an adequate grasp of basic algebra and graphical analysis.
        Studentsshould have no misconceptions about this course - it will be difficult
        to do well in this course unless you can correctly utilize equations and graphs.

4. Participation in class discussions whether in the form of questions, answers, or comments
        is strongly encouraged and will count towards the final grade.

5. That all assigned work will be submitted on time. No late work will be accepted regardless of
         the novelty of the excuse.

6. Occasionally, readings will be assigned to supplement the material covered in the textbook and
         the lectures. Students will be held responsible for all the material covered in the assigned
         chapters, readings and lectures, whether or not these are discussed in class.

Test Dates (During the class period):

September October              November                        December

Make-up Test: December

Make-up Test Policy:

                   No student, for whatever reason, will be allowed to take a regularly scheduled test earlier or later
                   than the above-mentioned times. Please do not even bother to ask for an exemption from this rule.
                   Instead, any student who misses a test (except the final exam) may take the make-up test. However,
                   a student may make-up only one test.
The make-up test will be comprehensive and will be the same
                   regardless of which periodic test you miss. The make-up test may not replace any earlier test in which
                   a student did poorly. Furthermore, a student's presence at the beginning of a regularly scheduled test
                   signifies that the test will count towards that student's final grade.

Final Exam:

                    There will be no early or late final exams given. The final exam will be comprehensive.

Academic Honesty:

                    Academic dishonesty will not be tolerated. In accordance with the university’s policy, anyone
                    caught cheating on a test or an assignment will receive an automatic grade of "F" for the course.
                    Plagiarism, claiming someone else's work as one's own, will also result in an automatic grade of
                    "F" for the course. The university may add its own penalty.

Grading:
                            4 Periodic Tests - 70% A 90 - 100
                            Final Exam - 25%         B 80  -  89
                            Attendance and                      C 75   - 79
                            Class Participation -5%         D 70   - 74
                                                                         F   00  -  69

Extra Credit Work: I turn down all requests to do extra credit work.

University Studies Program: Social Science Course

This course will satisfy three semester hours of the six-semester hour requirement for social science
in the University Studies Program. As such, it seeks to provide students taking this course the opportunity
to achieve the following outcomes:

  1. understand humans as individuals and parts of larger social systems
  2. understand the historical context of the social sciences
  3. identify problems and frame research questions relating to humans and their experience
  4. become familiar with the process of theory-building and theoretical frameworks used by the social sciences
  5. understand the research methods used in the social sciences
  6. describe and detail discipline-specific knowledge and its applications
  7. understand differences among and commonalities across humans and their experience, as tied to such variables as gender, race, socioeconomic status, etc.

The outline below identifies where these University Studies Program outcomes are addressed by placing
the letter references above in parenthesis.

 

Outline:

  1. Introduction

           Many of the fundamental concepts and common terminology of economics are introduced in these
           chapters. Upon reading these chapters, students should find that the study of economics is broad,
           complex and highly relevant. It is not just the study of "money". The appendix to chapter 1 is a must,
           particularly for students who are not familiar with graphs.

           Chapter 1 The Scope and Method of Economics

           Chapter 2 The Economic Problem: Scarcity and Choice
                               (b, c, d, e)

 

II. Domestic and International Economic Institutions

            An understanding of the economy requires that students know who are the major actors in the economy
            (households, businesses, and government) and the arrangements by which these actors interact with one
            another (e.g. markets, taxation). In addition, it is impossible to understand the US economy today without
            an understanding of the global environment. Hence, students must be prepared to learn about international
            trade, balance of payments, and foreign exchange rates.

  Chapter 3 The Structure of the US Economy: Private, Public, and International Sectors
                        (a, f, g)

III. The Data of Macroeconomics

            Macroeconomics focuses on the behavior of certain "aggregates". These "aggregates" are reflected in variables
            such as the Gross Domestic Product, the unemployment rate, and the inflation rate. Students have most likely
            encountered these terms in the mass media. However, students should acquire a deeper understanding of these
            variables in order to study the behavior of the economy and the sectors that comprise the economy.

            Chapter 21      Concepts and Problems in Macroeconomics
            Chapter 22      Measuring National Output and National Income
            Chapter 23      Unemployment, Inflation, and Growth
                                     (c, d, e, f, g)

IV. Macroeconomic Policy

          These chapters are at the core of macroeconomics. Among the major contributions of the discipline of
          economics are the various explanations of how the economy functions, how economic problems such
          as inflation and unemployment come about, and how policy can be used to improve the performance
          of the economy. These chapters will deal with fiscal and monetary policy. The student should be prepared
          to use graphical analysis extensively.

              Chapter 24        Aggregate Expenditure and Equilibrium Output
              Chapter 25         The Government and Fiscal Policy
              Chapter 26         The Money Supply and the Federal Reserve System
              Chapter 27         Money Demand, the Equilibrium Interest Rates, and Monetary Policy
                                        (a, b, c, d, e, f, g)

V. Issues in Macroeconomics

             While much of policy debates may be couched in political terms (for example, between Democrats
             and Republicans), the foundations of such debates are usually in economic theories. These chapters
             provide the students with the tools to better understand the policy debates, and to hopefully get
             beyond the political rhetoric. Students should be prepared to question the "conventional" wisdom
             surrounding economics.

               Chapter 28 Money, the Interest Rate, and Output: Analysis and Policy
               Chapter 29 Aggregate Demand, Aggregate Supply, and Inflation
               Chapter 30 The Labor Market, Unemployment, and Inflation
               Chapter 31 Deficit Reduction, Fed Behavior, Stabilization, Stocks, International Effects
               Chapter 32 Household and Firm Behavior in the Macroeconomy
                                        (a, d, f, g)

 

VI. International Dimensions of Economic Policy

              Trade, investments, and finance are the ties that bind the USA to the other economies of the world.
              As a result, the macroeconomy can no longer be studied in isolation. These chapters provide the
              student with an introduction to the international dimensions of the US economy as well as and
              introduction to the economies of developing countries and to non-market economies.

                Chapter 35 International Trade, Comparative Advantage, and Protectionism
                Chapter 36 The Balance of Payments and Exchange Rates
                Chapter 37 Economic Growth in Developing Nations
                Chapter 38 Economies in Transition and Alternative Economic Systems
                                        (b, c, f, g)