ECO102: PRINCIPLES OF MACROECONOMICS
COURSE OUTLINE
SEMESTER: SPRING 2013
Faculty Member’s Details
Name: Mr. Marios Demetriades
Office Hours: By Appointment
Email: marios_demetriades@hotmail.com
Web Site: http://www.cdacollege.ac.cy/site/business-studies/index.htm
Description
This course provides an introduction to macroeconomics. The focal points of this
course are related to how the economy functions both in the short and long-run, how
economic activity is measured and increased, what types of economic policy are
implemented and the importance of money for the healthy operation of economies.
Other important topics encompass consumption and investment, aggregate supply and
demand and the phenomena of inflation and unemployment.
Learning Outcomes
By the end of the course, students are expected to:
 understand basic economic concepts;
 understand how an economy operates;
 be able to apply some basic concepts to real macroeconomic phenomena;
 be able to read and understand the content of a financial newspaper or magazine;
Prerequisite(s):
Knowledge of basic mathematical and graphical techniques will contribute in helping
the students to comprehend the theory and application of real life scenarios within the
context of economic thinking.
Type of Course: Compulsory for Bachelor in Business Administration
Teaching Methods: Lectures, presentations, problem and case studies discussion and
analysis, preparation of assignments.
Course Teaching Hours: 39 hours a semester. The course is delivered during a 13-week
semester.
Assessment method and weight: 50% coursework and 50% final examination. Coursework
can be one or more of the following: mid-term examination, tests, assignments and projects.
Passing mark 50%.
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ASSESSMENT
Class Participation/Tests and assignments: 25%
Mid-term examination:
25%
Final examination:
50%
In evaluating the quality of your class participation, I will consider:
1st your attitude towards the course material;
2nd how well you prepare your homework assignments;
3rd how often you participate in the debate and class activities
Assignments: Assignments may be given at the end of each class. Additionally an
assignment will be given after the mid-term examination, concerning the chapters of
supply and demand to be delivered by the date of the final examination.
Mid-term examination: The mid-term examination will be of two hours. It will
mostly be essay questions and/or multiple-choice questions.
Final Examination: The final examination will be of two and a half hours. It will be
comprehensive and it will test the students on the material covered during the
semester.
The exams will consist of a section of identifications - in which you will write brief
definitions and describe the relevance of key concepts, theories, etc. -, a section with
simple calculus and an essay section. The first two sections may contain multiplechoice or True/False questions.
Business Studies Grading System:
%
Grade Grade Meaning
Grade
Grade
Points per
Credit
90-100
A
Excellent
4.00
80-89
B+
Very Good
3.50
75-79
B
Good
3.00
65-74
C+
Above Average
2.50
60-64
C
Average
2.00
55-59
D+
Below Average
1.50
50-54
D
Poor
1.00
Below 50
F
Failure
0.00
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Main Book
Title:
Economics
Author(s):
Samuelson, P.A., Nordhaus, W.
Edition/Year: Eighteenth / 2005
Additional Reading and Other Learning Resources
Books
Title:
Principles of Economics
Author(s):
Mankiw G.N.
Edition/Year: Fourth / 2006
Title:
Macroeconomics
Author(s):
Mankiw G.N.
Edition/Year: Sixth / 2007
Websites


Library of Economics Homepage: www.econlib.org
Economics About Homepage: economics.about.com
Journals



American Economic Review
Quarterly Journal of Economics
Journal of Macroeconomics
Periodicals


Financial Times
The Economist
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LEARNING OUTCOMES TABLE
WEEK
1st
Learning Outcomes and Content of the Course
The Fundamentals of Macroeconomics
Introduction in Macroeconomics. The constituents of the
economy. Key macroeconomic concepts and targets.
Definitions of Aggregate Supply and Demand. How is
the value of economic activity measured? Gross
Domestic Product (GDP). Rules for calculating GDP.
The GDP deflator. GDP and its components. The
Consumer Price Index. Circular macroeconomic flow.
2nd
3rd
4th
Chapters 20-21
Consumption and Investment- Business Cycles and
Aggregate Demand
How consumption and saving are defined. The
consumption function. Marginal propensities of
consumption and saving. Investment and Determinants
of Investment. Business cycles. Expansion and
recession. Demand Induced Cycles. Foundations of
aggregate demand. The aggregate demand curve.
Chapters 22, 23
Money, Commercial Banking and Monetary Policy
ACTIVITIES
Discussion,
Questions,
Applications
and Examples
Discussion,
Questions,
Applications
and Examples
Discussion,
Questions,
Money and Commercial Banking; Central Bank and Applications
Monetary Policy, the Process of Creation of Bank and Examples.
Deposits; How Monetary Policy Works to Control
Spending; Supply and Demand for Money
Chapters 25 and 26
The process of economic growth and development
The Theory of Economic Growth; the Trends and
Sources of Economic Growth; Economic growth models
and the aggregate production function of an economy;
the importance of technical change for growth and
endogenous growth models; The Economics of
Developing Countries; Theories of Economic
Development.
Discussion,
Questions,
Applications
and Examples
Chapters 27 and 28
5th
Revision of Mid Term material
6th
Mid-Term Examination
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Discussion,
Questions,
Applications
and Examples
Discussion,
Questions,
Applications
and Examples
7th
Inflation, Unemployment and Aggregate Supply
8th
Unemployment:
Importance of Unemployment;
Measuring Unemployment; Economic Interpretation of
Unemployment. Social and Economic Impact of
Unemployment. The foundations of aggregate supply.
Aggregate Supply in the Short and Long Run.
Determinants of aggregate supply
Inflation; Definitions and Costs; Causes and Cures;
What is Inflation; the Impact of Inflation; Analysis of
Inflation’s Costs; Alternative Sources of Inflation; the
Philips Curve; Open Issues; Incomes Policy.
Chapters 29 & 30
Exchange Rates and the International Financial
System
Exchange Rates and the International Financial System;
Mechanisms of Foreign Exchange and Trade; Three
Major Exchange Rate Systems; Macroeconomics of
Open Economies; Breakdown and Reconstruction of
The International System.
Chapter 34
9th
Comparative Advantage and Protectionism
10th
International Trade and the Theory of Comparative
Advantage; the Gains from Trade and the Law of
Comparative Advantage; the Balance of International
Payments. Protective Tariffs; Quotas and Free Trade;
Supply and Demand Analysis of Trade and Tariffs; the
Economics of Protectionism.
Chapter 35
The economic role of the government
Economic Role of Government: the Growth and
Functions of Government; Public Choice; Government
Expenditures; Principles of Taxation: the Theory
Problem of Tax Incidence.
11th
Chapter 33
Policies for Growth and Stability
The Fiscal-Monetary Mix and Government Deficits:
Modern Public Finance; the Fiscal Monetary Mix; Do
Deficits Crowd of Investment; Measuring and History of
Government Debts.
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Discussion,
Questions,
Applications
and Examples
Discussion,
Questions,
Applications
and Examples
Discussion,
Questions,
Applications
and Examples
Discussion,
Questions,
Applications
and Examples
Discussion,
Questions,
Applications
and Examples
Chapter 33
12th
Different schools of economic thought
The Classical school. Keynesian approach. The
Monetarists
of
Friedman.
New
Classical
Macroeconomics.
Ultra
Classicism-Supply side
economics.
Discussion,
Questions,
Applications
and Examples
Chapter 32
13th
Revision
Submission of
Assignment,
Discussion,
Questions,
Applications
and Examples
The course schedule is subject to changes.
Such changes will be duly noted in class.
OTHER INFORMATION
Class attendance: Students are expected to attend the classes and be punctual. In case
of non-attendance, students are advised to discuss about it with the instructor.
Human matters: Students should inform their faculty member for any unforeseen
matters that may occur, which may prevent them from fulfilling what is expected in
the frame of the course.
Library: The students are advised to visit the library of the College on a regular basis
and read articles published in academic journals. It is recommended that the expertise
of the College’s librarian is exploited by the students by enquiring for help, so as to
become fully aware of the facilities and search techniques offered by the library and
how these can be utilised by the students in a fruitful way. It is recommended that
study of articles published in international journals as well as financial newspapers
and magazines is regularly undertaken.
NOTES:
 Class attendance and participation in class discussion is expected and absences
will affect your final grade.
 The due dates for assignments are non-negotiable and late work will be
penalized.
 All assignments are to be professional in appearance and type.
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