BEC 102
FALL 2007
PRINCIPLES OF MACROECONOMICS
Syllabus
Instructor: Leticia Starkov
Office Hours: Monday and Wednesday 12:00 to 2:00 p.m.
Tuesday and Thursday 10:45 a.m. to 2:00 p.m.
Other times by appointment.
Office Location: ICT 213
Office Phone: 847 214 7465
Fax: 847 214 7361
E-mail: lstarkov@elgin.edu
Description
A basic course introducing the core macroeconomic terms and tools applied to the study of
the U.S. economy and its interactions with the global economy. The class includes an
overview of the economic way of thinking, the description of the key macroeconomic
variables, basic models to analyze changes in the level of real output and in the price level,
the role of money and the banking system, economic policy implications, and international
economics.
Goals
 Facilitate students’ learning of the basic macroeconomic terms and tools.
 Provide opportunities for students to apply the basic macroeconomic terms and tools
to analyze real world macroeconomic events and economic policies.
 Encourage students to think of the outcome of this course for the long run, as a way
to improve their ability to read, and understand, economic news, to make more efficient
economic decisions, and to increase their problem solving skills.
Course Objectives
After successful completion of the course, the students will:
 Use the individual market model of supply and demand to analyze the impact of
some events on the equilibrium price and quantity.
 Describe the key macroeconomic variables: inflation, unemployment, and economic
growth.
 Explain the following key macroeconomic issues: government budget, public debt,
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business cycle, exchange rate, and trade balance.
Describe the recent and the current situation of the key macroeconomic variables
and issues in the U.S. economy.
Identify the basic macroeconomic relationships.
Use the basic macroeconomic theory to assess changes in the level of real GDP and
in the price level.
Explain the role of the money supply and the interest rate in the economy.
Examine the globalization process and its impact on the economy.
Compare macroeconomic policies and their impact on the economy.
Explain and analyze macroeconomic news.
Apply the economic way of thinking and the current state of the economy to make
better economic decisions.
Required textbook
Campbell R. McConnell and Stanley L. Brue. Economics – Principles, Problems and
Policies. McGraw-Hill Irwin, 2008.
Other materials and resources
1.
2.
3.
4.
Website for our class: http://ecc.desire2learn.com
Study guide to accompany text available with the purchase of a new book.
Website for our textbook: http://www.mcconnell17.com
A reliable basic calculator.
Course structure
The course is divided into five parts. The first part is an introduction to the economic way
of thinking; it also presents the basic model that explains the functioning of the markets. In
the second part, we will describe the most important variables in the US economy and the
economic interaction of the US with the rest of the world. The third part analyzes the real
side of the economy, which means the interaction of macroeconomic variables that are
related to the production and consumption of goods and services. Studying the models in
this part we will understand how economic agents make decisions that influence the
economy and how they respond to fiscal policy. The fourth part studies the role of money
in the economy. We also learn about the institutions that affect the amount of money, such
as the Federal Reserve with the tools of monetary policy. In the fifth part we will cover
international economics, which explains the economic interactions between countries.
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Course Outline
I. The economic way of thinking
1. Limits, alternatives, and choices (Ch. 1)
2. The market system and the circular flow (Ch. 2)
3. Individual markets: demand and supply (Ch. 3)
II. Describing the US economy
1. The US economy: private and public sectors (Ch. 4)
2. The US in the global economy (Ch. 5)
3. Measuring domestic product, inflation, and unemployment (Ch. 6 and 7)
4. Economic growth and economic development (Ch. 7)
III. Understanding the real side of the economy
1. Basic macroeconomic relationships (Ch. 8)
2. The Aggregate Expenditures Model (Ch. 9)
3. Aggregate demand and aggregate supply (Ch. 10)
4. Fiscal policy, deficits, and the public debt (Ch. 11)
IV. Understanding the money side of the economy
1. Money and banking (Ch. 12)
2. Money creation (Ch. 13)
3. Interest rates and monetary policy (Ch. 14)
4. Disputes over macro theory and policy (Ch. 17)
V. International Economics
1. International trade (Ch. 37)
2. International finance (Ch. 38)
Class organization
I plan to combine lectures with in-class assignments and class discussions. I expect to have
your active and meaningful participation in all the activities. The learning process
requires effort from you and the final outcome in terms of your learning will be rewarded
not only with your class grade, but also with increased skills and knowledge for you. Your
grade will be based on quizzes, in-class assignments, news analysis, and exams. There will
also be extra credit opportunities in case you want to improve your grade. In the next
sections of the syllabus you will find detailed information about each of these learning tools
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and the grading weights assigned to each of them.
Students are expected to be respectful of themselves, the instructor and each other.
This means that behavior that violates this policy will not be tolerated and may result in a
student being dropped from the class with a failing grade. Please turn off cellular phones
during class time.
Please note that you are responsible for everything said in class, including exam dates and
assignments. The instructor reserves the right to make changes to the dates included in this
syllabus by giving notice during regular class meetings. It is responsibility of the students
to be aware of any announcement made during regular class time. If you miss a class
period, contact me to ask for any missed announcements.
Course Grades
Grading Points
Quizzes
In-class assignments
4 News analysis papers
4 Exams (12 points each)
Final exam
Total
12
9
16
48
15
100
Grading Scale
89.5 and up
79.5 -89.49
69.5 - 79.49
59.5 - 69.49
59.49 and below
A
B
C
D
F
The grading policies above are final. I will not consider changing your final grade just
because you are “close” to the cutoff for the next letter grade.
Quizzes
There will be quizzes throughout the semester. They will give you a good idea of the type
of questions that will appear in the multiple-choice part of the tests. The quizzes will be
given at the end of some class periods. The purpose of the quizzes is to check your
understanding of the material for the specific class period when the quiz is given and to
identify the aspects of the lecture that should be reviewed. There are no make-up
possibilities for quizzes. Quizzes will count for 12 percent of your final grade.
In-class assignments
There will be in-class assignments during the semester. Some of them will be completed
individually, others in groups of two to three students. The assignments may include case
studies, exercises, and experiments. Class participation will also count for in-class
assignment points. There are no make-up possibilities for in-class assignments. In-class
assignments will count for 9 percent of your final grade.
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News analysis
Reading and understanding economic news is one of the objectives of the macroeconomic
class. That is why you are required to write four mini papers where you analyze
macroeconomic news. The papers are due after we finish covering each of the macro
sections that correspond to parts II, III, IV, and V in the course outline. In the papers, you
must analyze economic news about the U.S. economy during 2007. Each paper should
present your personal reaction to at least two different sources of economic news articles.
News articles can be found in news papers or the Internet. Articles should come from a
reputable site (news paper or Internet site), such as: Business Week, CNNfn, The New York
Times or the Wall Street Journal. In our textbook’s website you can find the links to those
and more news sources. The College’s library is also a good source of news. It is important
to show the date in which the article was published in the print-out of the article, it needs to
be published in 2007. The news articles must be attached to your paper. I will demonstrate
early in the semester how to look for economic news articles.
All work must be typed using proper grammar, punctuation, and spelling. Double space all
work using a 12-point font size. Be sure to proofread your work carefully and staple your
paper. The minimum length for the paper is 2 pages and the maximum length is 4 pages. In
your papers, I will look for the connection of the economic news to the material
covered in class. Each paper counts for 4 percent of your final grade. Late assignments will
not be accepted.
Topics and due dates for the papers
Paper
1
2
3
4
Topic
Describing the US economy
The real side of the economy
The money side of the economy
International economics
Due date
October 15
November 7
December 3
December 12
Exams
There will be five exams during the semester and one final exam at the end. I will drop
from your final grade calculation the exam with the lowest score. The score of the final test
cannot be dropped. The exams will be given in the dates listed below. Solving some of the
exams will not take the entire class period, which means that we will continue our regular
class after the time for the test passes. Attendance at exams is mandatory. It is definitely
not a good idea to miss a test. If you must miss a test you will obtain a grade of zero in that
test which will be your lowest score and will be dropped from your final grade calculation.
If you must miss a second test, the grade of zero in that test will count towards your final
grade. There are no make-up exams in the class. The exams are based on the material
covered in class. Exams have two sections: a multiple-choice question part and a section
were you are required to solve numerical problems, graphical exercises or answer essay
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questions.
Exam dates
September 5
September 24
October 10
November 5
November 28
December 12
Exam 1
Exam 2
Exam 3
Exam 4
Exam 5
Final exam
Chapters 1-3
Chapters 4 and5
Chapters 6 and 7
Chapters 8 – 11
Chapters 13-15 and 17
Cumulative
Homework assignments
There will be five homework assignments during the semester. The content for the
homework assignments will give you a very good idea of the type of problems, exercises,
and questions that are part of the exams. The due date for each homework assignment is
one class period before each test. The purpose of the homework is to practice and to review
the material. Homework assignments will be solved in class before the exam date, so that
you will know the right answers to the problems, exercises, and questions before the test
date.
Homework assignments will count as extra credit. For earning extra credit points you
must bring to class, in the assigned date, the answers to the homework assignment and a
copy of these answers. You must turn the original at the beginning of the class period and
keep the copy with you to verify and to correct your answers. All multiple page
assignments must be stapled before class. I do not bring a stapler to the classroom. Please
do not turn in assignments with folded corners, paper clips or as loose sheets of paper. Each
extra credit assignment will increase your final grade by 1.6 points. You can earn a
maximum of 8 extra points during the semester. If you bring all the five homework
assignments, you will have a total of 8 extra credit points. Notice that extra credit points can
make the difference between two letter grades in your final grade. The homework
assignments must be delivered at the beginning of the assigned class period and you
must bring the copy with you to earn extra credit. The dates to turn in homework
assignments are stated in the detailed calendar posted in our class website. Late
assignments will not receive credit.
Class website
I am using a class website to enhance this course. I will show you how to access to this
Internet site from a computer on campus or from your home computer. Announcements
about our class, learning objectives for each lesson, a detail calendar, quizzes, and very
important class content will be posted on the website every week. It is crucial for your
progress in the class that you visit our class website at least twice a week to consult
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and to print the relevant documents. If you have problems to regularly visit our class
website or to print documents from it, please let me know ASAP so we can make
appropriate arrangements.
Cheating policy
In short, don’t do it. There are many ways to cheat, and all of them are wrong. Cheating in
any form will not be tolerated. Talking during an exam is not permitted and results in a
grade of zero on the exam. Looking at another students’ exam paper is not permitted and
results in a grade of zero in the exam. During an exam, sharing a calculator, loading
information on your calculator, and using a cellular phone are not permitted.
Plagiarism (copying paragraphs from written material without the appropriate reference) is
considered cheating.
A note on disability
If you are learning, sensory or physically disabled and feel that you need special assistance
in regard to lectures, assignments or tests, please contact me so that we can make
appropriate arrangements.
Final Note
I really would like for you to enjoy the course and even more important, for you to learn
useful ideas and analytical tools that may help you in future courses or in your everyday
decisions. I have a big responsibility in this task. I will do my part explaining carefully all
the topics, giving examples and solving exercises. Your part is not less important. I strongly
suggest you to follow these tips in order to achieve the better results:
 Read the book at least two times, once before covering the topic and the other after that.
 Practice answering questions and solving problems and quizzes in the book, the study
guide, and the textbook’s website.
 Attend class and visit our class website regularly.
 Do not leave it to the last minute. Economics is best learned in small regular doses
rather than trying to learn everything the night before the test.
 Ask questions and get answers. According to my experience teaching Economics, that is
one of the most important rules of the game. Do not keep doubts. Make sure that you
are following the topics. Otherwise you might face the snowball effect. This means that
a small question appearing, let’s say, in the second class period and kept unclarified,
could become an unsolvable puzzle one day before the final.
You will be very welcome if you ask questions during the class period or using my
office hours. You can also call me or send an e-mail with any question, comment or
request. Avoid getting lost in the course, asking questions when they appear or when
the idea is not clear enough.
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