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. 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