Economic Theory II
ECON 202.05
Spring 2003
Taner Yigit
Office: A112
W-Fr. 10:45-12:00
or by appointment
tyigit@bilkent.edu.tr
Objectives: Macroeconomics is the study of the overall behavior of the economy. In today's
economic conditions, where almost everybody is trying to decide whether to stay in the market
or not, understanding of economic conditions and policies has become more important. The goal
of this class is to gain a fundamental understanding of macroeconomic theories and see them in
action. This will not only provide us with a better understanding of the functioning of the
economy, but also allow us to reason through how things can be improved. Real life examples
(via assigned readings) will supplement the coursework to apply the theory obtained in economic
policy analysis.
I encourage group work (except in exams), and trying to connect what we learn in class
to real life situations. Grading will be based on interest, effort and hard work (participation is one
of many ways to show interest and effort). Attendance is obligatory; there will be short
unannounced quizzes, especially on the days with low attendance. There will few homework
assignments based on assigned readings. I am available should you have any problems in the
course. I have scheduled office hours. In addition I am usually available after class for
discussion or to schedule an appointment if you cannot make my scheduled office hours.
Exams: Grading will be based on class participation (10%), quizzes (10%), assignments (10%),
2 midterm exams (20% each), and a final exam (30%). The material on the midterm and the final
exam are cumulative.
Recommended textbook:
Abel & Bernanke. Macroeconomics 4th ed.
Course outline:
Introduction & Measurement
Goals of Government
Inflation, Unemployment & Growth
Short run
Income Determination
Aggregate Demand
Policy (Money & Financial Markets, Fiscal)
Medium Run
Aggregate Supply
Policy (Rational Expectations)
Long Run
Open Macroeconomics
Chapter(s)
1, 2
2, 3
5
9
7, 14, 15
9
6
13