Intermediate Macroeconomics 1 Course outline UWI Mona

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Intermediate Macroeconomics 1 Course outline UWI Mona

  1. 1. UNIVERSITY OF THE WEST INDIES, MONA CAMPUS DEPARTMENT OF ECONOMICS INTERMEDIATE MACROECONOMICS 1 ECON 2002 COURSE SYLLABUS BY MIKOL A. MORTLEY 1. Introduction Review of Basic Macroeconomic Concepts  What is Macroeconomics  Tradeoff between Unemployment and Inflation in the short run  Actual vs. Potential Values  Natural level of GDP  Natural rate of Unemployment  Short Run vs. Long Run analysis  Economic Models 2. Measurement of Income, Prices, and Unemployment a. Measurement of Income  Circular flow of Income  GDP  Methods of Calculation( Input, Output, Expenditure)  Limitations of GDP  GDP vs. GNP  Real and Nominal  GDP deflator  National Income Accounts  GDP  GNP  NNP  National Income  Personal Income  Personal Disposable Income  Personal Saving  Public Savings b. Measurement of Prices Changes  Inflation  Laspeyres Index  Paasche Index c. Measurement of Unemployment  Unemployment  Labor Force  Employment ratio  Unemployment rate  Labor Force participation  Types  Okun’s Law 3. Income Determination in the Short-run a. Subunit I - Review of Keynesian Income Determination  Keynes General Theory of employment, Interest and Money  Introduction to the Investment SavingsMoney Lending Model b. Subunit II – IS-LM Model  Keynesian Cross Model to derive IS  IS Curve  Investment Function  Consumption Function  Net Export Function  Mathematical and Graphical Derivations of the IS curve  Goods Market Fluctuations  LM Curve  Liquidity Preference Theory  Money Demand and Money Supply  Real Money Balances  Mathematical and Graphical Derivation of LM curve  IS-LM  Monetary Policy and IS-LM  Fiscal Policy and IS-LM  Monetary Policy Response to Fiscal Policy  Mathematical Derivations of Interest Rates and Equilibrium Output
  2. 2. 4. The AD Curve and Price Adjustment (Short-run and Long-run Analysis) a. b. c. d. Derivation of the AD Curve  Derived Through interactions of the IS-LM model  Monetary Policy and AD curve  Fiscal Policy and AD Curve Price Adjustment Mechanism (Aggregate Supply (AS))  3 types of Aggregate Supply Curves  Short Run Aggregative Supply (SRAS)  Reactions to Shocks in IS curve  Shocks to the LM curve  Changes is Aggregate Demand (AD)  Long Run Aggregate Supply  Combining AD and LRAS  Transitioning from SRAS to LRAS  Phillips Curve Price Adjustment The AD Curve and Price Adjustment  Monetary Policy, AD and Price adjustment  Short Run  Long Run  Money Neutrality  Fiscal Policy, AD and Price Adjustment  Short Run  Long Run  AD shocks  Policy Responses to AD shocks Extensions to Macroeconomic Policy  Stabilizing Output with Fiscal policy  Aggregate Demand Shocks  Supply Shocks(Price  Stabilizing Output to Monetary Policy

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