Advanced Placement Macro and Microeconomics
Fall 2011
David M. Elu, J.D.
dmelu@riordanhs.org
415-586-8200 ext 275
Overview
The Advanced Placement Program offers two separate examinations in economics; one in
microeconomics and one in macroeconomics. This course will provide students with a learning
experiences equivalent to those encountered in a typical college introductory to microeconomics
and macroeconomics.
The students will prepare for the Advanced Placement Microeconomics and
Macroeconomics Examinitions and Post-secondary Economics courses by their:
 mastering the economic way of thinking and decision making
 learning to support and explain concepts with both written responses and graphic
models
 demonstrating understanding of the connections between economics and math
 becoming familiar with the basic language of business and economics
 understanding the basic measurements of economic performance in printed media
Personal Statement
Given the everyday application of economics and the habit of mind endorsed by
economic thinking, AP Economics allows students to build creative thinking skills that will
allow them to better understand the workings of business and governments. They will be in a
position to look beyond general statements about economics and understand and evaluate the
statements. Furthermore, the students will be able to use the skills developed in AP Economics
and apply them to other areas of social science, namely, be critical of generalized statements and
look beyond them to examine their veracity and applicability to a particular situation.
General Course Objective for Micro and Macroeconomics
The course in Microeconomics introduces students to the economic way of thinking. The
course commences with cost–benefit, which is the key analytical tool of the economics way of
thinking. The students use this analysis to understand smaller segments of the economy—
specifically, consumers and producers—as they interact in output markets and resource markets,
and to understand the government’s impact on these specific economic units. Also used is
Supply and Demand analysis, used to demonstrate how market prices are determined, how those
prices determine an economy’s allocation of goods and services, how factors of production are
allocated in the production process, and how goods and services are distributed throughout the
economy. The students will evaluate the strengths and weaknesses of economic decision makers
by using the concepts of efficiency and equality. Students will use reasoned logical economics
arguments to examine business decision making.
Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
The course in Macroeconomics focuses on how the economic system works as a whole.
The students will build upon the concepts learned in microeconomics. Students will learn how
the economy is measured using aggregate indicators such as gross domestic product (GDP),
unemployment rates, price indices and other indicators. Students will learn to analyze models
that explain the relationship between such factors as national income, output, consumption,
unemployment, inflation, savings rates, investment, international trade and international finance.
Students engage in the decision-making process that leads to an environment where high
employment and a higher standard of living are achievable by using the economic tools of fiscal
and monetary policy. The students will learn to examine microeconomic models and forecasts
that are used by both governments and large corporations to assist in the development and
evaluation of economic policy and business strategy.
AP Test Information
The AP Microeconomics Exam will be given on Thursday May 17, 2012 and the AP
Macroeconomics Exam will be administered on Thursday May 17, 2012. The outline from the
College Board (they administer the AP tests) is provided in the front cover of the study guide. I
will hold review sessions beginning in April 2012 to help you review and I will administer a
practice test during the semester. All the students are expected to take the AP test, as this course
will prepare you.
Text and Materials
Mankiw, N. Gregory. PRINCIPLES OF ECONOMICS, 5th ed., Mason, OH: South-Western Cengage
Learning, 2009.
Anderson, David, and Chasey, James. FAVORITE WAYS TO LEARN ECONOMICS, 2nd ed., Mason,
OH: South-Western Cengage Learning, 2009.
Whalen, Charles, NAKED ECONOMICS: UNDRESSING THE DISMAL SCIENCE (Fully Revised and
Updated), New York, W.W. Norton & Company, Inc., 2010
NCEE, Advanced Placement Economics: Microeconomics Student Activities
NCEE, Advanced Placement Economics: Macroeconomics Student Activities
Web site for the text, www.swcollege.com/econ/mankiw/student/microindex.html
Instructor’s web site for the course, http://eluecon.wikispaces.com/
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Overall Course Objectives
At the completion of the course the student will be able to:
 Demonstrate economic questioning skills [c1]
 Interpret a variety of graphical models [c6] and paraphrase economic concepts
 Analyze the development of modern economic theory
 Explain the basic connections between economics and calculus
 Use and interpret the language of business and basic measurements of economic
performance
 Apply economic skills and concept knowledge to higher college level economic
courses.
Objectives by Unit
Microeconomics Units 1 – 6
Unit 1 – Basic Economic Concepts (August 15-19)
Chapters 1-3 in Mankiw, PRINCIPLES OF ECONOMICS
In this unit, the students will:
 be introduced to the economic concepts of scarcity, opportunity cost, and
marginal analysis. [cr1][cr5]
 learn and use the production possibility frontier curve and circular flow models;
and
 participate in a simulation of the circular flow model and use the production
possibility frontier to analyze the benefits of voluntary exchanges
Unit 2 – Supply and Demand I – How Markets Work/Theory of
Consumer Choice (Aug 22-31)
Chapters 4-8 & Ch 21 in Mankiw, PRINCIPLES OF ECONOMICS
In Unit 2, students will:
 learn the assumption and determinants of supply and demand in order to use
models of markets for description, analysis and prediction
 explain the significance and role of prices in a market economy
 use concepts of elasticity of demand and supply to evaluate economic situations in
a quantitative manner [cr2]; and
 evaluate the use of government price controls and the impact of taxes on markets
 learn to explain and calculate the value-to-market participants of voluntary exchanges
(this will include the concepts of consumer surplus and producer surplus).
 analyze market distortions from taxes, specifically the changes in consumer surplus,
producer surplus, and total surplus
 be introduced to the idea of deadweight loss; and
 evaluate consumer surplus and producer surplus in markets that import or export, and
evaluate the deadweight loss from trade restrictions
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Unit 3 – Supply and Demand II – Markets and Welfare [cr2](Sep 1-15)
Chapters 13-14 in Mankiw, PRINCIPLES OF ECONOMICS
In unit 3, the student will:
 understand a firm’s cost of production and how these costs are shown in the
shapes of the cost curve [cr2];
 learn characteristics of the categories of competition in markets[cr5];
 explain and show graphically how production and pricing decisions are made for
firms in each of these markets [cr6]; and
 analyze how firms behave in the short run, and the long run and evaluate markets
for productive and allocative efficiency [cr5]
Unit 4 – Market Structures (Sep 16-29)
Chapters 14-16 in Mankiw, PRINCIPLES OF ECONOMICS
In this unit, the students will:





Explain the difference between accounting and economics profits.
Identify and examine sources of monopoly power
Demonstrate understanding of the relationships between a monopolist’s demand
curve and its marginal revenue curve.
Document understanding of a monopolists price, level of output and profit with
those of a firm operating in a perfectly competitive market.
Explain Game Theory
Unit 5 – Resource Markets (Sep 30-Oct5)
Chapter 18 & 19 in Mankiw, PRINCIPLES OF ECONOMICS
In unit 6, the students will:
 apply the concepts of supply and demand to markets for factors such as labor,
capital and land. [cr3]
 document labor supply and wage and unemployment determination
 analyze the concepts of derived demand and document how a factor’s marginal
product and the marginal revenue affect the demand for the factor
 explain the role of factor prices in the allocation of scarce resources
 identify the various stages of the circular flow market
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Unit 6 – The Economics of the Public Sector (Oct 6-12)
Chapters 10-11, 15 and 20 in Mankiw, PRINCIPLES OF ECONOMICS
In this unit; the students will:
 analyze external costs and benefits that can occur in markets (private and public
solutions to these externalities will be examined);
 understand characteristics of public goods, private goods and common goods and
will consider implications of these characteristics
 become familiar with the components of government budgets and evaluate tax
policies[cr4]; and
 understand how the distribution of personal income in an economy is measured
and discuss issues related to income distribution
Macroeconomics Units 7 – 12
Unit 7 – Measurement of Economic Performance (Oct 18-25)
Chapters 23-24, 28, 30, & 33 in Mankiw, PRINCIPLES OF ECONOMICS
In this unit, the student will be able to:
 describe the causes of inflation and its affect on the economy
 calculate GDP, and determine the difference between real and nominal values
 list the types of unemployment and explain how they relate to the concept of
natural rate of unemployment
 use the Phillips Curve to demonstrate the relations between inflation and
unemployment in the short run and the long run
Unit 8 – National Income Accounting and Price Determination (Oct
26-Nov2)
Chapter 33-34
In this unit, the student will be able to:
 use economic models to explain short-run fluctuations in economic activities
 list the reasons that the aggregate demand curve is sloping
 explain why the long-run aggregate supply curve is vertical
 explain why aggregate supply curve is upward sloping
 discuss what makes aggregate supply curve shift
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Unit 9 – Money, Banking, the Financial Sector, and Monetary Policy
(Nov 3-14)
Chapters 26-27, 29-30 in Mankiw, PRINCIPLES OF ECONOMICS
In this unit, the student will be able to:
 list the functions and characteristics of money
 discuss the role of M1 and M2 in the economy
 explain the role of the Federal Reserve System and describe how policies affect
consumers, business investment, real national output, and price levels in the long
run
 analyze the nature of the interaction between monetary and fiscal policy
 explain how expansionary and contractionary fiscal policy affects real national
output and price level in the short run and long run
 analyze the impact fiscal policy on government deficits and the national debt
Unit 10 –Inflation, Unemployment and Stabilization Policies (Nov 15Dec 1)
Chapters 8, 33-35 in Mankiw, PRINCIPLES OF ECONOMICS; Ch 19 in Stone, CORE
ECONOMICS
In Unit 10, the students will be able to:
 Explain the theory of liquidity preference and its application to the aggregate
demand curve
 Use liquidity theory to explain the affects of money supply on aggregate demand
curve
 List examples of government policy that has acted as automatic stabilizers
 Discuss automatic stabilizers and how they work
 Draw the short-run tradeoff between inflation and unemployment
 Draw the long-run tradeoff between inflation and unemployment
 Explain the difference between long run tradeoff and short run tradeoff
 Describe the natural rate of unemployment
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Unit 11 – Economic Growth and Productivity (Dec 2-8)
Chapter 25 in Mankiw, PRINCIPLES OF ECONOMICS
In this unit, the student will be able to:
 Understand the factors that affect economic growth
 Realize that economic growth fuels a higher standard of living
 Differentiate between deficits and debt
 Comprehend the size of the US Public Debt and what effect this debt has on the
Macroeconomy
 Understand the classical and Keynesian models and see how they relate to
macroeconomic stability
 Understand the rational expectation model and understand how it effects the
macroeconomic stability
 Use the monetary rule as a device in monetary policy to stabilize the economy
Unit 12 – International Trade and Finance (Dec 9-15)
Module 36, 41, & 43 in Ray, PRINCIPLES OF ECONOMICS, Ch 26 in Stone, CORE
ECONOMICS, and Ch 36 in Baumol, PRINCIPLES OF ECONOMICS
In this unit, the student will be able to:
 Define net exports and net capital flow
 Explain how they are related
 Explain the relationship between saving, investment and net capital outflow
 Describe the economic logic behind the theory of purchasing-power parity
 Describe supply and demand in the market for loanable funds
 Describe supply and demand in the market for foreign currency exchange
 Explain the concept of capital flight and its effects on interest and exchange rates
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Student Evaluation
Student grades are determined as an average of all work, quizzes and test. Grades are
calculated as follows:
Quarter 2 Grades
Quarter 1 Grades
 Homework/Classwork – 25%
 Project – IES game – 20%
 Quizzes – Reading (daily or
near daily) - 25%
 Test – 30%
 Homework/Classwork – 20%
 Projects – 15%
 Quizzes – Reading (daily or
near daily) – 20%
 Tests – 25%
 Midterm Exam 20%
Semester Grade
Quarter 1
30%
Quarter 2
40%
Summer Reading
5%
Final Exam
25%
Grade Scale
A= 100-85%, B= 84-75%, C= 74-60%, D= 59-51%, F= 50 or 0%.
NOTE: Your score on the AP examination has no bearing on your class grade.
Late Work Policy
1. For normal daily homework assignments
a. a 50% drop in grade if the assignment is one or more days late.
b. No credit for homework submitted after major assessment for which homework was
assigned.
c. No credit for homework after assignment has been returned to class
(Note: for b and c it is whichever comes first)
2. For major assignments (tests or papers):
a. a 10% drop in points earned for each day late to a maximum of 50% drop in points.
b. after five days, a 50% F will be assigned if paper is submitted.
c. if no paper is submitted, a zero grade will be assigned.
3. No late homework or assessments will be accepted one week prior to mid-term or
final examinations.
4. All missed quizzes must be made up prior to major assessment for the unit or chapter and a
zero will be assigned until such quizzes are made up.
5. For legitimate absences, students have to make arrangements with the teacher for making up
assignments.
6. Acceptance of late work for full credit will be only for extraordinary reasons and left to the
discretion of each teacher.
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Absence Policy
Because of the block schedule that we are on, frequent absences are not only frowned
upon, but can be fatal to a student’s grade. If you are out of school for a full day or more, you
have twice as much time as you were out to make up all missing assignments. For example, if
you missed 1 day, you have 2 days to make up the work. If you are out for 2 days, you have 4
days to make up the work. If you are out for less than a full day (i.e. sporting event, etc), you
only have one day to make up the missing assignments. Assignments that were due while you
were out are due on the day you return regardless of how long you out.
When you get back to school, you should go to the class binder and pick up any handouts
you missed and get and fill out an “Absentee Form.” You must give it to me to initial before you
leave that day. This will serve as a contract and reminder. All missed exams will be made up in
the Academic Resource Center within 1 week. Remember, it is your responsibility to get
anything that you missed. I will only remind you once and I will not chase you down to get the
work from you.
Technology Component
The students will be engaged with technology throughout the duration in the course. The
students will be able to obtain, copies of teacher's presentations, flip-charts, and homework
assignments from the web site at www.eluecon.wikispaces.com. The student s will also post
written assignments using the course page on googledocs.com (address to be provided in class).
Students are encouraged to collaborate using googledocs when outside of class. We will have a
short session on how students will use googledocs to submit documents and how they can
collaborate with each other.
Teaching Strategies
 Complete AP Exam problems in class. Give students 10 – 15 minutes to work out old
AP free-response questions. Allow the students work in small groups. When a group
finishes they are to place their response on the board. Either at beginning or end of class.
Benefits of this
 allows me to work with groups of students so that they can received individualize
instruction
 allows me to assess where common misunderstandings lie.
 students learn to complete AP problems in the time allotted for the AP Exam.
They learn to pace themselves
 Give reading previews. Give introductory lectures to the upcoming reading from the
textbook. Lectures are not to be a substitute for the reading; they let the students read
new material with some familiarity. When students tackle the text with some familiarity
with the ‘big picture’, they get the most from the time they spend on the reading.
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
 Frontload on fundamental topics. Emphasize the material in the units early on in the
course. Make sure that the students understand the basic concepts such as opportunity
cost, supply and demand, and the cost curves. A complete understanding of these topics
will allow the students to pick up the new topics quicker because the topics do build upon
one another.
Course Requirements
Students are expected to
1. be on time and prepared for class. On time means in your seat when the bell rings. If
you are not in the room by the time the bell has rung, you will be marked tardy.
2. maintain a neat and organized 3-ring binder that will be used solely for this class.
The binder will serve as a notebook as well as a portfolio. There will be regular
binder checks to make sure that it is in good order.
3. have 5 dividers, one for general information and handouts (i.e. syllabus) the
remainder will be designated in class
4. bring all materials to class every day. This includes texts, blue or black pen for notes
and a red pen for correcting, #2 pencils for Scantron quizzes and tests.
5. All must be on standard 8-1/2” by 11” binder paper or graph paper (it is best that you
use graph paper for this class). If a paper is torn, wrinkled, folded, torn from a spiral
notebook, etc. I will give it right back to you!
6. complete all work neatly. Work that is sloppy or done in a haphazard manner will not
be accepted. It will be returned to the student to be redone and marked as a late
assignment.
7. complete and understand (as best you can) all assigned readings. There is no
substitute for knowing the facts.
8. type all projects and papers.
9. take good notes on lectures, presentations etc. Everything that is presented in the
class is fair game for exams, so you have to be prepared. We will talk specifically
about note taking skills throughout the course.
10. complete all assignments and turn them in at the beginning of the class period.
11. RESPECT EVERYONE in the classroom. Everybody has a valid opinion. We must
agree that we can (and will) disagree. If there is a disagreement, argue against the
rationale not the individual.
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
Microeconomics - Reading Assignments
AP Microeconomics Topics
Textbook Correlation
Unit 1 - Basic Economic Concepts
Aug 15-19
A. Scarcity, Choice and Opportunity Ch 1 p. 3-8, Ch 3 p. 54Costs
59,
B. Production Possibility Curve
Ch 2 p. 25-28, Ch 3 p.
51-54
C. Comparative Advantage,
Specialization and Trade
Ch 3 52-59
D. Circular Flow
E. Property Rights and Role of
Incentives
Ch 2 p. 24-25
Ch 1 p. 7-8
F. Marginal Analysis
Unit 1 - Exam
Ch 1 p. 6, Ch 2 p. 25-28
Unit 2 - How Markets
Work/Theory of Consumer Choice
A. Supply and Demand
1. Market Equilibrium
2. Determinants of supply and
demand
Aug 22-Sep 2
3. Price and quantity controls
a. Price ceiling
b. Price floor
B. Elasticity
a. Price elasticity of demand
b. Income and cross-price
c. Price elasticity of supply
C. Consumer Surplus, producer
surplus and market efficiency
Ch 6
Ch 6 p. 114-118
Ch 6 p. 118-121
Ch 5
Ch 5 p. 90-97
Ch 5 p. 97-99
Ch 5 p. 99-102
Ch 7. p 138-152
D. Tax Incidence and
deadweight loss
B. Theory of consumer choice
1. Total utility and marginal
utility
2. Utility maximization:
equalizing marginal utility per dollar
Ch 8 p. 160-171
Reading
and Exam
Dates
8/16
8/16
8/17
8/18
8/18
8/19
Ch 4 p. 67-76
Ch 4 p. 77-83
Ch 4 p. 69-71 & p. 7476
8/22
8/22
8/24
8/25
8/25
8/26
8/26
8/28
8/29
8/30
Ch 21 p. 465
9/1
Ch 21 p. 465
9/1
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
3. Income and Substitution
effect
Unit 2 -Exam
Ch 21 p. 466-471
AP Microeconomics Topics
Textbook Correlation
Unit 3 – Supply and Demand II –
Markets and Welfare [cr2]
A. Production and Costs
1. Production functions: short
and long run
Sep 6-15
Ch 13
Ch 13 p. 271-273
9/1
9/2
9/6
2. Marginal product and
diminishing returns
Ch 13 p. 272-273
3. Short run costs
4. Long run costs and
economies of scale
Ch 13 p. 273-280
Ch 13 p. 280-281
9/8
9/12
9/13
9/15
Unit 3 - Exam
Unit 4 – Market Structures
A. Firm behavior and market
structure
1. Profit
a. Accounting versus
economic profit
Sep 16-29
b. Normal profit
c. Profit maximization:
MR=MC rule
Ch 14 p. 290-292
Ch 14 p. 293-295
2. Perfect competition
a. Profit maximization
b. Short-run supply and
shutdown decision
Ch 14 p. 290
Ch 14 p. 292-295
Ch 14 p. 295-300
c. Behavior of firms and
markets in the short and long run
Ch 14 p. 300-304
d. Efficiency and perfect
competition
Ch 14 p. 290
3. Monopoly
a. Sources of market power
b. Profit maximization
c. Inefficiency of monopoly
Reading
and Exam
Dates
Ch 13 p. 270-295
Ch 13 p. 270
9/16
9/16
9/19
9/19
9/20
9/20
9/21
9/21
9/21
Ch 15
Ch 15 p. 312-316
Ch 15 p. 316-322
Ch 15 p. 322-326
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9/23
9/23
9/23
Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
d. Price discrimination
4. Oligopoly
AP Microeconomics Topics
Ch 15 p. 326-332
Ch 17 p. 365-366
Textbook Correlation
a. Interdependence, collusion
and cartels
Ch 17 p. 366-370
b. Game theory and strategic
behavior
Ch 17 p. 370-378
5. Monopolistic competition
a. Product differentiation and
role of advertising
Ch 16 p. 346-347
Ch 16 p. 355-360
b. Profit maximization
c. Short-run and long-run
equilibrium
Ch 16 p. 352-353
Ch 16 p. 348-351
d. Excess capacity and
inefficiency
Ch 16 p. 351-352
9/23
9/25
Reading
and Exam
Dates
9/25
9/26
9/27
9/27
9/28
9/28
9/28
9/29
Unit 4 - Exam
Unit 5 - Factors Market
A. Derived factor demand
B. Marginal revenue product
C. Labor market and firm's hiring of
labor
Sep 30-Oct 5
Ch 18 p. 392-399
Ch 18 p. 393-396
Ch 18 p. 399-405
9/30
9/30
D. Market distribution of income
Unit 5 Exam
Ch 19 p. 414-421
10/3
10/3
10/5
Unit 6 - Market failure and the
role of government
A. Externalities
1. Marginal social benefit and
marginal social cost
Oct 6-12
2. Positive externality
3. Negative externality
4. Remedies
B. Public goods
1. Public versus private goods
Ch 10 p. 207-209
Ch 10 p. 205-207
Ch 10 p. 209-219
Ch 11
Ch 11 p. 226-228, p.
232-236
2. Provision of public goods
C. Public policy to promote
Ch 10 p.
ch 10 p. 204-208
Ch 11 p. 228-232
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10/6
10/6
10/6
10/7
10/7
10/7
10/7
Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
competition
AP Microeconomics Topics
1. Antitrust policy
2. Regulation
D. Income Distribution
1. Equity
2. Sources of Income
Inequality
Unit 6 - Exam
Textbook Correlation
Ch 15 p. 332, 336 Ch
17 p. 378-379
Ch 15 p. 333
Ch 20
Ch 20 p. 445-449
Ch 20 p. 434-438
Reading
and Exam
Dates
10/10
10/10
10/11
10/11
10/13
Macroeconomics - Reading Assignments
AP Macroeconomics Topics
Unit 7 - Measurement of Economic
Performance
A. National income accounts
1. Circular flow
2. Gross domestic product
3. Components of gross domestic
product
4. Real versus nominal gross
domestic product
Textbook Correlation
Reading
and Exam
Dates
Oct 14-19
Ch 23 p. 508-509
Ch 23 p. 510-512
Ch 23 p. 510-515
10/14
10/14
10/17
Ch 23 p. 515-519
10/17
B. Inflation measurement and
adjustment
1. Price Indices
2. Nominal and real values
3. Cost of Inflation
C. Unemployment
1. Definition and measurement
2. Types of Unemployment
3. Nature and reality of
unemployment
Ch 24 p. 530-539
Ch 24 p. 539-541
Ch 30 p. 676-682
10/18
10/18
10/18
Ch 28 p. 614-622
Ch 28 p. 622- 627
Ch 28 p. 624-627
10/19
10/19
10/19
10/24
Unit 7 - Exam
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Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
AP Macroeconomics Topics
Unit 8 - National Income and Price
Determination
A. Aggregate Demand
1. Determinants of aggregate
demand
2. Multiplier and crowding-out
effects
B. Aggregate supply
Textbook Correlation
Ch 33 p. 745-749
Ch 33 p. 749-751
10/25
10/25
Ch 34 p. 788-792
10/25
Ch 33 p. 745-746 &
751-752
1. Short-run and long-run analysis
2. Sticky versus flexible wages
and prices
Ch 33 p. 752-757
Ch 33 p. 757-760
3. Determinants of aggregate
supply
Ch 33 p. 753-755 &
760-762
C. Macroeconomic equilibrium
1. Real Output and price level
2. Short and long run
3. Actual versus full-employment
output
Ch 33 p. 762
Ch 33 p. 755-756
Ch 33 p. 762-765
Ch 33 p. 753 & 756757
4. Economic fluctuations
Unit 8 - Exam
Reading
and Exam
Dates
10/26
10/26
10/26
Ch 33 761-767
10/26
10/28
10/28
10/28
10/31
11/1
11/2
Unit 9 - Financial Sector
A. Money, banking and financial
markets
1. Definition of financial assets;
money, stocks, bonds
Ch 26 p. 576-580
2. Time value of money (present
and future value)
Ch 27 p. 598-600
3. Measures of money supply
4. Banks and creation of money
5. Money demand
6. Money market
7. Loanable funds market
B. Central Bank and control of the
money supply
Ch 29 p. 645-647
Ch 29 651-653
Ch 30 p. 664-667
Ch 30 p. 667-668
Ch 26 p. 583-585
Ch 29 p. 648-649
1. Tools of the central bank
11/3
Ch 29 p. 653-658
15
11/7
11/8
11/8
11/8
11/8
11/9
11/10
11/10
Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
AP Macroeconomics Topics
Textbook Correlation
2. Quantity theory of money
3. Real versus nominal interest
rates
Unit 9 - Exam
Ch 30 p. 670-672
Ch 30 p. 674-676
Unit 10 - Inflation, Unemployment
and Stabiliation Policies
A. Fiscal and monetary policies
1. Demand-side effects
2. Supply-side effects
3. Policy mix
4. Government deficits and debt
B. Inflation and unemployment
1. Types of Inflation
a. Demand-pull inflation
b. Cost-push inflation
2. The Phillips curve: short-run
versus long-run
3. Role of expectations
Unit 10 - Exam
Unit 11 - Economic Growth and
Productivity
A. Investment in human capital
B. Investment in physical capital
Reading
and Exam
Dates
11/10
11/10
11/14
11/15
Ch 34 p. 778-785
(monetary policy) Ch
34 p. 787-792 (fiscal
policy)
Ch 8 p. 169-171 &
Stone, Ch 20 p. 531535
Ch 34 p. 794-795
Stone, Ch 23 p. 598603
11/21
11/18
11/21
11/22
Ch 33 p. 755 & Stone,
Ch 19 p. 512-514
11/28
Ch 33 p. 755 & Stone,
Ch 19 p. 514 -515
11/28
Ch 35 p. 308-316
Ch 35 p. 316-322
Ch 25 p. 556, 563-566
Ch 25 p. 555-556, 558562
C. Research and development, and
technological progress
Ch 25 p. 568 & 571
D. Growth policy
Unit 11 - Exam
Ch 25 p. 648-570
16
11/29
11/30
12/1
12/5
12/5
12/6
12/7
12/8
Macro and Microeconomics
Advanced Placement
David M. Elu, J.D.
AP Macroeconomics Topics
Unit 12 - Open Economy:
International Trade and Finance
A. Balance of payments accounts
1. Balance of trade
2. Current account
3. Capital account (financial acct)
B. Foreign exchange market
1. Demand for and supply of
foreign exchange
2. Exchange rate determination
3. Currency appreciation and
depreciation
Textbook Correlation
Ray, M41 p. 410
Ray, M41 p. 411
Ray, M41 p. 412
Ray, M41 p. 413
Reading
and Exam
Dates
12/9
12/9
12/12
12/12
Ray, M 42 p. 421-425
12/13
Stone, Ch 26 p. 671677
Stone Ch 26 p. 677-681
12/13
12/13
C. Net exports and captial flow
Baumol, Ch 36 p. 765766
D. Links to financial goods markets
Ray, M 36 p. 763-775
& Ray M45 p. 443-452
Final Exam
All references are to primary textbook, Mankiw, N. Gregory,
Principles of Economics, 6th ed., South-Western Cengage
Learning, Mason, OH
References to Stone are to reference book: Stone, Gerald.,
Core Economics, Worth Publishing, NY
References to Ray are to reference book: Ray,Margaret and
David Anderson, Krugman's Economics for AP, Worth
Publishing, NY
References to Baumol are to reference book: Baumol,
William J., and Alan S. Blinder, Economics Principles and
Policy, South-Western Cengage Learning, Mason, OH
17
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12/20