E200 - The Fundamentals of Economics
Instructor's Name: John Kessler
Course Location: Helmke B-35
Class Meeting Times: Monday/Wednesday 3pm - 4:15pm
Office Hours: Wednesday
1:30 pm to 2:30 pm or by appointment
Neff Hall, 340G
Office:
Work:
260-481-6493
Email:
Contact me through Blackboard Mail
Electronic Resources: Blackboard - ipfw.blackboard.com
Required Text:
James Gwartney, Richard L. Stroup, Dwight R. Lee, and Tawni H. Ferrarini,
Common Sense Economics: What Everyone Should Know about Wealth
and Prosperity: Revised and Updated, St. Martins Press, 2010
Welcome:
Welcome to Econ 200, Fundamentals of Economics! In this course you'll develop knowledge and
understanding of economics and the economic way of thinking. I look forward to working with
you over the next sixteen weeks as we explore the fascinating world of economics. This is going to
be an exciting semester full of new learning experiences. I look forward to getting to know all of
you as the year progresses and I hope you are looking forward to a challenging year.
School is where you go to learn skills that help make you a productive citizen and grow to your
fullest potential as a human being. What you make of it is up to you. There is only one way for a
student to learn anything. The student must put in effort; the student must work to learn. A study
showed that students who do more homework, attend school regularly, and read more do better in
school (duh!). This study cost $369,636 of taxpayer money.
The act ofleaming is a choice, and the student owns the process oflearning. The instructor's role
is to provide a learner-centered environment and access to the resources and assistance necessary
for the learner to succeed. I hope we can work together to make this a class that produces rich
rewards and prepares you well for the future!
Course Objective:
"A few lines ofreasoning can change the way we see the world." - Steven E. Landsburg
The objective for this one semester course is to enable you to acquire an understanding of a few
select microeconomic and macroeconomic principles that are a part of your every day
environment.
The class is broken into four parts. The first part of the class will focus on principles and concepts
as scarcity, incentives, opportunity cost, marginal analysis, voluntary trade, profits and losses, the
importance of prices and how they are set, GDP, productivity, and the unintended consequences of
our choices. The second part of the class will focus on the importance of institutions on economic
growth and will cover concepts such as property rights, competitive markets, capital markets,
monetary stability and inflation, unemployment, taxes, and free trade. The third part of the class
will focus on the role that government plays in the economy in protecting property rights and
providing public goods and then apply public choice economic analysis and the concept of
incentives to the choices of government employees and politicians. The last portion of the class
will focus on applying economic reasoning to your personal financial decisions.
I will attempt in this class to teach you a new way of seeing the world. I hope that by the end of
this class you will see how economics relates to every aspect of your life.
General Education Competencies:
The Fundamentals of Economics course satisfies the Social and Behavioral Ways of Knowing
Competency (Category B.5) requirements of the IPFW General Education Program. Specifically,
the course meets the learning objectives listed below.
5.1 Demonstrate knowledge of major concepts, theoretical perspectives, empirical patterns, or
historical contexts within a given social or behavioral domain.
5.2 Identify the strengths and weaknesses of contending explanations or interpretations for social,
behavioral, or historical phenomena.
5.3 Demonstrate basic literacy in social, behavioral, or historical research methods and analyses.
5.4 Evaluate evidence supporting conclusions about the behavior of individuals, groups,
institutions, or organizations.
5.5 Recognize the extent and impact of diversity among individuals, cultures, or societies in
contemporary or historical contexts.
5.6 Identify examples of how social, behavioral, or historical knowledge informs and can shape
personal, ethical, civic, or global decisions and responsibilities.
Course Requirements:
Grades reflect effort, knowledge, completion, and timeliness on the following:
Quizzes:
Syllabus Quiz
14 Quizzes ( 1Opts each)
Exams:
Part I Test
Part II Test
Part III Test
Final Exam
Totals:
15 Quizzes
4 Tests
20 Points
140 Points
160 Points Total
60 Points
60 Points
60 Points
120 Points
300 Points Total
160 Points
300 Points
460 Points Total for the Course
Attendance:
Attendance is strongly encouraged. Students who attend classes will earn better grades. There will
be activities that we do in class that you will not be able to make up. If you miss a class it is your
responsibility to learn the content. In order to provide the proper incentive for attendance, the
following grading policy is in effect:
0-3 Absences = no grade reduction
4-6 Absences = 5% final grade reduction
7+ Absences = 10% final grade reduction
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The instructor reserves the right to add or change assignments as he sees fit to meet the needs of
the class. There may be a variety of other assignments given throughout the semester.
Grading Scale: Grades are earned and are not given! There will be no rounding up of grades.
A = 90 - 100 percent
B = 80 - 89 percent
C = 70 - 79 percent
D = 60 - 69 percent
F =under 59 percent
(4 l 4pts - 460pts)
(368pts - 413pts)
(322pts - 367pts)
(276pts - 32lpts)
(275pts or less)
Quizzes:
All quizzes are due by 11:59pm on the due date. The computer does not allow for late
assignment submissions so be sure to have them in on time. No late quizzes will be accepted.
SYLLABUS QUIZ: This is a quiz to assure that you have read and understand the syllabus. It can
be found in the Assignments folder. It is ten questions of multiple choice and T/F and has no time
limit.
Syllabus Quiz-Due September 5, 2014
READING QUIZZES: These are quizzes that will test your reading of the assigned texts. You
may complete these assignments any time before their due date. You will have up to three
attempts for each quiz - your highest grade will count. Be sure to SAVE YOUR ANSWERS AS
YOU GO in case of computer problems. There are ten questions on each quiz and you have 30
minutes to complete each attempt.
Part 1 Quizzes
Quiz 1-over
Part 1 #1-3 (due
September 12)
Quiz 2-over
Part 1 #4-6 (due
September 19)
Quiz 3-over
Part 1 #7-9 (due
September 26)
Quiz 4-over
Part 1 #10-12
(due October 3)
Part 2 Quizzes
Quiz 5-over
Part 2 #1-2 (due
October JO)
Quiz 6-over
Part 2 #3-5 (due
October 24)
Quiz 7-over
Part 2 #6-7 (due
October 31)
Part 3 Quizzes
Part 4 Quizzes
Quiz 8-over
Part 3 #1-3 (due
November 14)
Quiz 9-over
Part 3 #4-5 (due
November 14)
Quiz 10 - over
Part 3 #6-7 (due
November 21)
Quiz 11 - over
Part 3 #8-10 (due
November 21)
Quiz 12 - over
Part 4 #1-3 (due
December 5)
Quiz 13 - over
Part 4 #4-6 (due
December 5)
Quiz 14- over
Part 4 #7-9 (due
December 12
Exams:
All exams will be done on the Blackboard website.
Exams will be available on the dates listed below for 24 hours. The exam will open at
12am and close at 11 :59pm. There will be no class on test dates so that you may prepare
and take the exams on Blackboard. Do not wait until the last minute to take your
exams in case there are computer problems. It is expected that you will take the test
during the regularly scheduled class time to alleviate this potentiality. However, you may
choose to take it at a different time if you are a morning or night person and test better at
those times.
You will have one chance to take the exams - you will not be able to retake a test because
of a bad grade. Be sure to SAVE YOUR ANSWERS AS YOU GO in case of computer
problems. The tests are timed between 50 and 100 minutes depending on the length of the
exam.
Part I Test - October 1, 2014
Part II Test-November 3, 2014
Part III Test-November 24, 2014
Final Exam - (3pm class) Friday, December 19, 2014 from lpm- 3pm
Course Changes
The above dates are tentative. The instructor reserves the right to change the dates of any
exam, quiz, or assignment as necessary to meet the needs of the class. If this happens it
will be announced in class and via Blackboard.
Computer Problems:
If you have computer problems during an exam or quiz or questions about Blackboard
you must call IT Services at 260-481-6030 (Monday - Friday 7:30am - 1Opm, Saturday
8am-4pm, Sunday 1 lam-7pm) or online at http://www.ipfw.edu/its They will be able to
assist you and give you a ticket number so that I know you had a problem.
Personal technical issues are the responsibility of the student. If you encounter a
technical issue that interferes with your class involvement, please let me know as soon as
possible. I will work with you within reason to keep you involved in class, but expect all
issues to be resolved within 24 hours.
Course Outline/Schedule/Reading Assignments:
Date
August 25
August 27
Readine: Assie:nment/Topic
Introductions and Syllabus
Part 1 #1 - Incentives Matter
Read Common Sense Economics (CSE) Part 1 pages 5-8 (Key #1)
"Moral Misunderstanding and the Justification for
Markets" Article on Blackboard
"The Power oflncentives" Article on Blackboard
Syllabus Quiz due September 5
September 1
September 3
Part 1 #2 - There is No Such Thing as a Free
Lunch
September 8
Part 1 #3 - Decisions are made at the margin
Read CSE Part I - pages 9-11 (Key #2)
"Opportunities and Costs" Article
"Econ 101" Article
"The Road Not Taken" - Robert Frost poem
Read CSE Part I-pages 11-13 (Key #3)
"More on Marginalism" Article
Quiz 1 due September 12
September 10
Part 1 #4 - Trade promotes economic progress,
Part 1 #5 - Transaction costs are an obstacle to
trade
Read CSE Part I - pages 13-17 (Keys #4-5)
"Specialization and Wealth" Article
"An Immense Discovery" Article
Listen to Podcast - "Middlemen" on Blackboard
September 15
Part 1 #6 - Prices bring the choices of buyers
and sellers into balance.
Read CSE Part I- pages 18-21 (Key #6)
"Demand, Supply and Adjustments to Dynamic
Change" Article
Quiz 2 due September 19
September 17
Part 1 #6 cont. - Prices bring the choices of
buyers and sellers into balance.
September 22
Part 1 #7 - Profits direct businesses toward
activities that increase wealth, Part 1 #8 People earn income by helping others, Part 1
#9 - Production of goods and services people
value, not just jobs, provides the source of high
livine: standards.
Part 1 #10 - Economic progress comes
primarily through trade, investment, better
ways of doing things, and sound economic
institutions
Part 1 #11 - The "invisible hand" of market
prices directs buyers and sellers toward
activities that promote the general welfare,
Part 1 #12 - Too often long-term
consequences, or the secondary effects, of an
action are ignored.
September 24
September 29
Read CSE Part I - pages 21-29 (Keys #7-9)
"What is Seen and What is Not Seen" Article
"Creating Jobs vs. Creating Wealth" Article
Quiz 3 due September 26
Read CSE Part I - pages 30-32 (Key #10)
"GDP" Article
"Gross Domestic Nonsense" Article
Read CSE Part I - pages 32-39 (Keys #11-12)
"The Use of Knowledge in Society" Article
"I, Pencil" Article
"Limitations of the Economic Way of Thinking"
Article
"Sacrificing Lives for Profits" Article
Quiz 4 due October 3
October 1
Part I Test
October 6
Part 2 #1 - Legal system: The foundation for
economic progress is a legal system that
protects privately owned property and enforces
contracts in an even-handed manner.
Read CSE Part II - pages 45-53 (Key #1)
"Private Property and Opportunity Cost" Article
"Running Out of Agricultural Land" Article
"Why the world is not about to run out of oil"
Article
October 8
Part 2 #2 - Competitive markets: Competition
promotes the efficient use of resources and
provides a continuous stimulus for innovative
improvements.
Read CSE Part II - pages 53-57 (Key #2)
"Competition" Article
October 15
Part 2 #3 - Limits on government regulation:
Regulatory policies that reduce trade also
retard economic progress.
Read CSE Part II- pages 57-60 (Key #3)
"Censoring Pleas for Help" Article
"Bastiat's Negative Railroad" Article
"Unemployment" Article
October 20
Part 2 #4 - An efficient capital market: To
realize its potential, a nation must have a
mechanism that channels capital into wealthcreating projects. Part 2 #5 - Monetary
stability: Inflationary monetary policies distort
price signals, undermining a market economy.
Read CSE Part II- pages 60-66 (Keys #4)
"Do banks really create money out of thin air?"
Article
"CPI and Measurement of Inflation" Article
October 22
Part 2 #5 cont. - Monetary stability:
Inflationary monetary policies distort price
signals, undermining a market economy.
Read CSE Part II - pages 66-73 (Keys #5)
"Monetary Policy" Article
"Fed FAQ" Article
"How do you inject money into the economy"
Article
Quiz 6 due October 24
October27
Part 2 #6 - Low tax rates: People will produce
more when they are permitted to keep more of
what they earn. Part 2 #7 - Free trade: A
nation progress by selling goods and services
that it can produce at a relatively low cost and
buying those that would be costly to produce
domestically.
Read CSE Part II - pages 73-77 (Key #6)
"Taxation" Article
"Trickle Down" Theory and "Tax Cuts for the
Rich" Article
October 29
Part 2 #7 cont. - Free trade: A nation progress
by selling goods and services that it can
produce at a relatively low cost and buying
those that would be costly to produce.
Read CSE Part II - pages 77-89 (Keys #7)
"Unfair Competition with the Sun" Article
"Comparative Advantage" Article
"Underdeveloping Indiana" Article
Quiz 5 due October 10
October 13
Quiz 7 due October 31
November 3
Part II Test
November 5
Part 3 #1 - Government promotes economic
progress by protecting the rights of individuals
and supplying goods that cannot be provided
throu2h markets.
Part III - pages 95-99 (Key #1)
"Public Goods" Article
November 10
Part 3 #2 - Government is not a corrective
device. Part 3 #3 - The costs of government are
not only taxes.
Read CSE Part III - pages 100-106 (Keys #2-3)
"The Economic Advantages of a Commitment to
Liberty" Article
Quiz 8 due November 14
November 12
November 17
November 19
November24
November26
December 1
December 3
December 8
December 10
December 19
Part 3 #4 - Unless restrained by constitutional
rules, special-interest groups will use the
democratic political process to fleece taxpayers
and consumers. #5 - Unless restrained by
constitutional rules, legislators will run budget
deficits and spend excessively.
Read CSE Part III - pages 106-115 (Keys #4-5)
"Politics and Foreign Trade" Article
"Fiscal Policy and Budget Deficits" Article
Part 3 #6 - Government slows economic
progress when it becomes heavily involved in
trying to help some people at the expense of
others. Part 3 #7 - The costs of government
income transfers are far greater than the net
gain to the intended beneficiaries.
Read CSE Part III-pages 115-124 (Keys #6-7)
"Poverty in America" Article
Part 3 #8 - Central planning replaces markets
with politics, which wastes resources and
retards economic progress. Part 3 #9 Competition is just as important in government
as in markets. Part 3 #10 - Constitutional rules
that bring the political process and sound
economics into harmony will promote
economic progress.
Quiz 9 due November 14
Quiz 10 due November 21
Read CSE Part III - pages 124-143 (Key #8-#10)
"Energy Production vs. Conservation" Article
"Social Cooperation and the Marketplace" Article
"Photo Economics" Article
Quiz 11 due November 21
Part III Test
Part 4 #1 - Discover your comparative
advantage. Part 4 #2 - Be entrepreneurial.
Part 4 #3 - Use budgeting to help you save
regularly and spend your money more
effectively.
Part 4 #4 - Don't finance anything longer than
its useful life. Part 4 #5 - Avoid credit card
debt and purchase used items. Part 4 #6 - Pay
into a "real-world" savings account.
Read CSE Part IV - pages 149-161 (Key #1-#3)
Budgeting Excel Spreadsheet
Quiz 12 due December 5
Read CSE Part IV - pages 162-168 (Key #4-#6)
Quiz 13 due December 5
Part 4 #7 - Put the power of compound interest
to work for you. Part 4 #8 - Diversify. Part 4 #9
- Indexed equity funds can help you beat the
experts without taking excessive risk.
Read CSE Part IV - pages 168-178 (Key #7-#9)
Part 4 #10 - Invest in stocks for long-run
objectives, but as the need for money
approaches, increase the proportion of bonds.
Part 4 #11 - Beware of investment schemes
promising high returns with little or no risk.
Part 4 #12 - Teach your children how to earn
money and spend it wisely.
Final Exam (l-3pm)
Read CSE Part IV - pages 178-190 (Key #9-#12)
To Roth or Not to Roth Article
Quiz 14 due December 12
Student Evaluations
POLICIES:
Student Conduct
The following is taken from the Student Handbook Policies and Code:
"Part II: Student Conduct Subject to Disciplinary Action ...
IPFW may discipline a student for committing acts of academic or personal misconduct.
A. Academic Misconduct. ..
6. Serving as or permitting another student to serve as a substitute (or 'ringer') in
taking an exam ...
B. Personal Misconduct ...
4. Disorderly or disruptive conduct that interferes with teaching, research,
administration, or other IPFW or IPFW-authorized activity."
Any behavior of this sort will be reported directly to the Dean of Students for immediate
disciplinary action.
Academic Honesty
I highly value academic honesty. You must always submit work that represents your
original words or ideas. For any words or ideas used in a class posting or assignment
submission which do not represent your original words or ideas, you must cite all relevant
sources and make clear the extent to which such sources were used. Words or ideas that
require citation include, but are not limited to, all hard copy or electronic publications,
whether copyrighted or not, and all verbal or visual communication when the content of
such communication clearly originates from an identifiable source.
Any student participating in acts of academic dishonesty-including, but not limited to,
using unauthorized "crib notes", plagiarism, completing an exam or homework for
another student, or any of the above - will be given zero points for that assignment and
may be subject to receiving an F for the course. Any written assignment that appears to
be a copy of another student's work will necessitate that each student involved receive a
zero score for that assignment.
Withdraw Policy
If a student must drop the course for any reason, it will be the responsibility of the student
to withdraw from the course before the withdrawal deadline. August 31st is the last day
to withdraw for a full refund and October 31st is the last day to withdraw for no refund.
Writing Center
Save time and write better papers for any class through free individual consultations in
the Writing Center in the Leaming Commons in Helmke Library 2°d Floor. Bring
assignments, questions, ideas, and a draft (if you have one). Consultants can help you get
started, write more clearly, revise, edit, and cite sources responsibly. Come as you begin a
paper and as you revise. Drop-ins are welcome if time is available, but appointments,
made online through TutorTrac, receive preference. For TutorTrac, online consulting, and
resources to make your writing process easier call 481-5740 or go online at
http://www.ipfw.edu/writing/
Writing Center Hours:
Monday-Thursday 9am to 6pm (Closed Monday and Wednesday from 12-lpm)
Friday
9am to 2pm
Sunday
1pm to 5pm
Disabilities Statement
If you have a disability and need assistance, special arrangements can be made to
accommodate most needs. Contact the Director of Services for Students with Disabilities
(Walb, room 113, telephone number 481-6658) as soon as possible to work out the
details. Once the Director has provided you with a letter attesting to your needs for
modification, bring the letter to me. For more information, please visit the web site for
SSD athttp://www.ipfw.edu/disabilities/