York University
Faculty of Liberal Arts & Professional Studies
Department of Economics
SUMMER-S2 2014
Course # and Title:
AP/ECON 2450 3.0B – Intermediate Macroeconomics Theory-II
Course Webpage:
NOTE: Course is run on Moodle @yorku. You log in with York ID @
https://moodle.yorku.ca/moodle/my/
Course Instructor/Contact:
Name:
Office:
Phone:
Office Hours:
Email:
Zafar Kayani
Atkinson – 736
416-736-2100 Ext. 33501
MW 1:45-2:45PM
zkayani@yorku.ca
Lecture Time and Location:
Lecture: MW 3:00 – 6:00pm
Lecture Hall: ACW-006
TA hours: TBA
Prerequisite / Co-requisite:
AP/ECON 2400 3.00
Course Description:
This course is a continuation of AP/ECON 2400. The topics in this course will refine our
understanding of the economy. This course will focus on the Macroeconomics of shortrun fluctuations. The IS-LM model will be used to link goods and the money markets.
The course also looks at the micro-economic foundations of macro-economic
relationships such as the consumption, investment and money demand functions. The
Main purpose of the course is to realize the significance of theory in the policy-making
process. Therefore, a special discussion will be made to see the effects of the monetary
and fiscal policy variables on the behavior of the whole economy.
Weighting of Course & Evaluation:
MIDTERM EXAM: (July 9, 2014, Chapters: 10, 11, 12, 13 and 14)
50%
FINAL EXAM: (comprehensive: 20% midterm and 80% post midterm material) 50%
Maximum Value of (Option1: Midterm 50% + Final 50% OR Option2: Final 100%)
Moodle: is a learning tool that is used for this course. The class material: lecture notes,
assignments, grades and course related announcements will be posted on the Moodle. It is
recommended that you frequently log on to the Moodle to view the updated posts.
Grading
The grading scheme for the course conforms to the 9-point grading system used in
undergraduate programs at York (e.g., A+ = 9, A = 8, B+ = 7, C+ = 5, etc.). Assignments
and tests will bear either a letter grade designation or a corresponding number grade (e.g.
A+ = 90 to 100, A = 80 to 90, B+ = 75 to 79, etc.)
Course Text / Readings:
Text Book: N. Gregory Mankiw & William Scarth, Macroeconomics. 4rd Canadian Ed.,
Worth Publishers, New York 2011.
Exams and Exam Policy: There is no make-up for the missing midterm exam. If you
miss midterm exam then I will transfer the weight of the midterm exam to the final exam.
You must notify me within forty-eight hours after the midterm exam or before the
midterm exam with your valid and well documented excuse by in person, by email or in
writing. Failing to report missing midterm exam will cost you zero in the midterm exam.
Students who are absent from the final examination and requesting for deferred standing
must follow the Guidelines for Deferred Standing of the Department of Economics.
http://dept.econ.yorku.ca/undergraduate/Deferred_Standing1.pdf.
The request for deferred standing will not be approved if the conditions listed on the
Guidelines are not satisfied.
Organization of the Course (Topics):
WEEK-1
Chapter 10: Aggregate Demand I: Building the IS-LM Model
10-1 The Goods Market and the IS Curve
10-2 The Money Market and the LM Curve
10-3 The Short-Run Equilibrium
Chapter 11: Aggregate Demand II: Applying the IS-LM Model
11-1 Explaining Fluctuations with the IS–LM Model
11-2 IS–LM as a Theory of Aggregate Demand
WEEK-2
Chapter 12: The Open Economy Revisited: The Mundell-Fleming Model and the
Exchange-Rate Regime
12-1 The Mundell–Fleming Model
12-2 The Small Open Economy Under Floating Exchange Rates
12-3 The Small Open Economy Under Fixed Exchange Rates
12-4 Interest-Rate Differentials
12-5 Should Exchange Rates Be Floating or Fixed?
Chapter 13: Aggregate Supply and the Short-Run Trade-Off Between Inflation and
Unemployment
13-1 The Basic Theory of Aggregate Supply
13-2 Inflation, Unemployment, and the Phillips Curve
WEEK-3
Chapter 14: A Dynamic Model of Aggregate Demand and Aggregate Supply
14-1 Elements of the Model
14-2 Solving the Dynamic Model
14-3 Using the Model
WEEK-3 (MIDTERM EXAM JULY 9, CHAPTERS: 10-14)
WEEK-4:
Chapter 15: Stabilization Policy
15-1 Should Policy Be Active or Passive?
15-2 Should Policy Be Conducted by Rule or by Discretion?
Chapter 16: Government Debt and Budget Deficits
16-1 The Size of the Government Debt
16-2 Problems in Measurement
16-3 The Traditional View of Government Debt
16-4 The Ricardian View of Government Debt
WEEK-5
Chapter 17: Consumption
17-1 John Maynard Keynes and the Consumption Function
17-2 Irving Fisher and Inter-temporal Choice
17.3 Franco Modigliani and the Life-Cycle Hypothesis
17-4 Milton Friedman and the Permanent-Income Hypothesis
Chapter 18: Investment
18-1 Business Fixed Investment
18-2 Residential Investment
18-3 Inventory Investment
WEEK-6
Chapter 19: Money Supply and Money Demand
19-1 Money Supply
19-2 Money Demand
Next Steps for Canadian Monetary Policy
http://www.bankofcanada.ca/wp-content/uploads/2010/06/amano.pdf
Additional information:
Academic Accommodation for Students with Disabilities
Alternate Exam and Test Scheduling
Grading Scheme and Feedback Policy
The Senate Grading Scheme and Feedback Policy stipulates that (a) the grading scheme
(i.e. kinds and weights of assignments, essays, exams, etc.) be announced, and be
available in writing, within the first two weeks of class, and that, (b) under normal
circumstances, graded feedback worth at least 15% of the final grade for Fall, Winter or
Summer Term, and 30% for ‘full year’ courses offered in the
Fall/Winter Term be received by students in all courses prior to the final withdrawal date
from a course without receiving a grade. "20% Rule"
Important Course Information for Students:
All students are expected to familiarize themselves with the following information,
available on the Senate Committee on Curriculum & Academic Standards webpage;
http://www.yorku.ca/secretariat/policies/index-policies.html/
• York’s Academic Honesty Policy and Procedures/Academic Integrity Website
• Ethics Review Process for research involving human participants
• Course requirement accommodation for students with disabilities, including
physical, medical, systemic, learning and psychiatric disabilities
• Student Conduct Standards
• Religious Observance Accommodation
ACADEMIC HONESTY: The Faculty of Liberal Arts and Professional Studies
considers breaches of the Senate Policy on Academic Honesty to be serious matters. To
quote the Senate Policy on Academic Honesty: The Policy on Academic Honesty is an
affirmation and clarification for members of the University of the general obligation to
maintain the highest standards of academic honesty. As a clear sense of academic honesty
and responsibility is fundamental to good scholarship, the policy recognizes the general
responsibility of all faculty members to foster acceptable standards of academic conduct
and of the student to be mindful of and abide by such standards.
Suspected breaches of academic honesty will be investigated and charges shall be laid if
reasonable and probable grounds exist.
Grading Scheme and Feedback (Senate)Policy:
http://www.yorku.ca/secretariat/policies/document.php?document=86
IMPORTANT COURSE INFORMATION
The Senate Committee on Curriculum & Academic Standards (CCAS) provides a
Student Information Sheet that includes:
Students should review the York Academic Honesty policy for themselves at:
York's Academic Honesty Policy & Procedures/Academic Integrity Web site
Access/Disability
Religious Observance Accommodation
Student Code of Conduct
No examinations or tests collectively worth more than 20% of the final grade in a course
will be given during the final 14 calendar days of classes in a term. The exceptions to the
rule are classes which regularly meet Friday evenings or on Saturday and/or Sunday at
any time, and courses offered in the compressed summer terms. Final course grades may
be adjusted to conform to Program or Faculty grades distribution profiles.