UNIVERSITY OF CAPE COAST
DEPARTMENT OF ECONOMICS
PRINCIPLES OF ECONOMICS II (ECO 102)
SECOND SEMESTER 2015/2016
CREDIT: 3HOURS
COURSE DESCRIPTION
This course introduces students to basic macroeconomic concepts, models and their
applications. The course covers the concept of national income and its determination,
money creation, banking structure, and the trade-off between inflation and
unemployment. The course enables the students to analyse the impact of fiscal
and monetary policies on the macroeconomic variables.
COURSE OBJECTIVE
 To introduce students to the essential principles needed to understand the
basic problem of the Macroeconomy, specific economic issues, and policy
alternatives.
 To help the student formulate and apply the economic perspective and to
reason accurately and objectively about economic matters.
 To promote a lasting student interest in the study of economics.
COURSE OUTLINE
 Introduction to Macroeconomics
a) What is Macroeconomics?
b) Origin and Development of Macroeconomics
c) Basic Concepts
d) Real Business Cycles
 Measurement of National Income
a) Circular Flow of Income
b) Methods of Measuring National Income
I. Income Method
II. Output Method
III. Expenditure Method
c) Uses of National Income Data
d) Price Indices
 Keynesian Economics
a) National Income Determination (up to three sector model)
b) Introduction to Monetary and Fiscal Policies
c) Output and the Price Level
d) Unemployment and Wage Rigidity
e) Equilibrium in the Static Model
 Introduction to Money
a) Origin and Development of Money
b) Functions and Features of Money
c) Banking and the credit creation process
d) Tools of Monetary Control
 Introduction to International Trade Theory
a) Absolute Cost Advantage
b) Comparative Cost Advantage
c) Gains from Trade
Mode of assessment
1. Two quizzes (30%)
2. One project work (10%)
3. One End-of-Semester exam (60%).
READING LIST
1. King, David (2012). Economics. New York: Oxford University Press Inc.
2. Lipsey, G. and Chrystal, A. (2011). Economics, 12th Edition. New York: Oxford
University Press Inc.
3. Hubbard, G.R., Obrien, A.P. & Rafferty, M. (2012). Macroeconomics. PrenticeHall, New Jersey
4. Case, K.E., Fair, R.C. & Oster, S.M. (2012). Principles of Macroeconomics. 10th
Ed. Prentice-Hall, London.
5. Case, K.E., Fair, R.C. & Oster, S.M. (2009). Principles of Economics II. 9th Ed.
Prentice-Hall, London.
6. Lipsey, G. and Chrystal, A. (2007). Economics, 11th Edition. New York: Oxford
University Press.
7. Lipsey, G. and Chrystal, A. (2004). Economics, 10th Edition. New York: Oxford
University Press.
8. Nellis, J. & Parker, D. (2004). Principles of macroeconomics. Prentice-Hall,
London
9. McConnell, C. and Brue, S. (2002). Economics: Principles, Problems and Polices.
New York: McGraw-Hill Higher Education.
10. Vaish, M.C. (2002). Macroeconomic Theory, 12th Rev. Ed. Vikas Publishing
House Ltd. New Delhi.
11. Mankiw, G. (1998), Principles of Macroeconomics. 2nd Edition.
12. Parkin, M. and Bade, R. (1995). Modern Macroeconomics. 4th Ed. Prentice-Hall,
Inc. New Jersey.
13. Hardwick, P., Khan, B. and Langmead, J. (1994). An Introduction to Modern
Economics. 4th Edition, Adison Wesley, New York.
14. Abel, A. and Bernanke, B. (1994). Macroeconomics, 2nd Edition.Adison-Wesley
Inc., New York.
15. Baumol, W. & Blinder, A. (1991) Macroeconomics: principles and policy. 5th
ed. San Diego: Harcourt Brace Jovanovich