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Please Note: This Class Syllabus is an important step in updating the format of our distance courses. If for any reason the Class
Syllabus does not match the print Course Guide or online course information, the Class Syllabus shall be taken as correct.
CLASS SYLLABUS
COURSE TITLE:
Money and Income (Macroeconomics)
COURSE CODE:
ECON 114.3
TERM:
Spring/Summer 2015
COURSE CREDITS:
3
DELIVERY:
Independent Studies
COURSE SECTION:
X01
START DATE:
May 6, 2015
END DATE:
August 11, 2015
Course Description
The course shows the student how to understand the collective problems in economic policy,
and the choices, which face a modern economy. Social accounting, national income,
consumption, saving, government spending, taxation, investment, interest rates, money and
banking, foreign trade, and balance of payments are analyzed.
Note: ECON 111 recommended.
Course Objectives
The formal name of this course is Money and Income, but we call it Macroeconomics or Macro.
ECON 114.3 introduces macroeconomics. The purpose of the course is to help you understand
how our market economy works at an aggregate level (microeconomics shows how our market
economy works at a more disaggregate level).
1. Summarize the basic principles of macroeconomics and various competing theories.
2. Identify key macroeconomic variables and measurement of such variables.
3. Generalize the relationships among various macroeconomic variables.
4. Develop a simple macroeconomic model based on aggregate demand and aggregate
supply.
5. Evaluate how fiscal policy and monetary policy influence macroeconomic variables in
order to achieve macroeconomic stability.
6. Examine the role of the Bank of Canada and its tools of monetary policy.
7. Outline major theories of economic growth and various strategies for developing lessdeveloped countries.
8. Explain the implications of international trades and capital movements for
macroeconomic variables in a small open economy.
9. Critique how government policies affect macroeconomic outcomes and the current
debates s about the choice of appropriate government policies.
March 23, 2015 gm ck pk wd
ECON 114.3 – Money and Income
Your Instructor
Wendy Doell
Contact Information
E-mail: wendy.doell@usask.ca (preferred method of contact)
You will be contacted through your PAWS email account. Information regarding the course will
be sent out periodically by email or through announcements. You may expect a reply to your
email within 24 hours; however, it may take longer on weekends. If I am away, I will let you
know ahead of time as I may be slow in responding to your email.
Office Hours
Thursdays 7:00-9:00 p.m. by phone (306) 717-6202 or by appointment at Main campus.
Profile
Wendy Doell is a Sessional Lecturer in the Department of Economics. She has been teaching
introductory economics and business for a number of years. Please feel free to ask questions in
regard to the course materials.
Required Resources
Readings/Textbooks
The following textbook is required for this course:
Mankiw, N. G., Kneebone, R. D., and McKenzie, K. J. (2014) Principles of
Macroeconomics (6th Canadian edition). Nelson Publishing. ISBN: 978-0-17-653085-3
The textbook is designed so you can take Macroeconomics without first completing
Microeconomics. However, as noted previously, we recommend that you complete ECON 111.3
(Microeconomics) before taking ECON 114.3.
This second book is optional, but strongly recommended. Study guides are very useful in
introductory courses in Economics, but especially so in Independent Studies. You will see
examples of the kinds of questions you can expect on your assignments and examination. If you
are concerned about the cost, think that a few more dollars can make a difference in your grade.
Fortura et al., Study Guide to Accompany Principles of Macroeconomics. (6th Canadian
edition). Nelson. ISBN: 978-0-17-656063-8
Textbooks are available from the University of Saskatchewan Bookstore:
http://www.usask.ca/consumer_services/bookstore/textbooks
Downloads/Supplementary Resources
Supplementary student handouts (PowerPoint notes), flash cards, crossword puzzles, student
resources, and economic applications are located on the course web site in PAWS >
Blackboard > Textbook Student Resources. These are optional materials if you have access to
the Internet.
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ECON 114.3 – Money and Income
Class Schedule
Week/Date
Module
Readings from
the Required
Textbook
1/May 6
Module 1 – Introduction to Economics
Chapter 1
2/May 13
Module 2 – Measuring a Nation’s Income
Chapter 5
3/May 20
Module 3 – Measuring the Cost of Living
4/May 27
Module 4 – Production and Growth
May 28-29
Break
5/June 3
Module 5 – Saving, Investment and the
Financial System
6/June 10
Module 6 – Unemployment
7/June 17
Module 7 – The Monetary System
Module 8 – Money Growth and Inflation
June 22-24
Break
8/June 25
Module 9 – Open Economy
Macroeconomics: Basic Concepts
9/July 1
Module 10 – A Macroeconomic Theory of
the Open Economy
Chapter 13
10/July 8
Module 11 – Aggregate Demand and
Aggregate Supply
Chapter 14
11/July 15
Module 12 – The Influence of Monetary
and Fiscal Policy on Aggregate Demand
July 17-22
Break
12/July 22
Module 13 – The Short-Run Trade-Off
between Inflation and Unemployment
Module 14 – Debates over
Macroeconomic Policy
13/Aug 5
Exam preparation
Chapter 6
Assignment #1
(Chapters 1, 5, 6)
Due: May 22
Chapter 7
No Evaluations
Chapter 8
Chapter 9
Assignment #2
(Chapters 7-9)
Due: June 5
Chapter 10
Chapter 11
No Evaluations
Chapter 12
FINAL EXAM
Evaluation Due
Date
Chapter 15
Assignment #3
(Chapters 10-12)
Due: June 26
Assignment #4
(Chapters 13-15)
Due: July 10
No Evaluations
Chapter 16 and
Chapter 17
Assignment #5
(Chapters 16-17)
Due: July 31
August 14, 2015
(2:00 p.m.)
Note: If for any reason the Class Syllabus Reading List does not match the Module Reading
List, the Class Syllabus shall be taken as correct.
Page 3 of 10
ECON 114.3 – Money and Income
Grading Scheme
Assignment 1
10%
Assignment 2
10%
Assignment 3
10%
Assignment 4
10%
Assignment 5
Final Exam
10%
50%
Total
100%
Information on literal descriptors for grading at the University of Saskatchewan can be found at:
http://students.usask.ca/current/academics/grades/grading-system.php
Please note: There are different literal descriptors for undergraduate and graduate students.
More information on the Academic Courses Policy on course delivery, examinations and
assessment of student learning can be found at: http://policies.usask.ca/policies/academicaffairs/academic-courses.php
The University of Saskatchewan Learning Charter is intended to define aspirations about the
learning experience that the University aims to provide, and the roles to be played in realizing
these aspirations by students, instructors and the institution. A copy of the Learning Charter can
be found at: http://policies.usask.ca/documents/LearningCharter.pdf
Evaluation Components
Note: See a later section on Submitting Assignments for details on submitting all assignments.
Assignment 1
Value:
10% of final grade
Due Date:
May 22, 2015
Purpose:
This assignment is based on the material in modules 1, 2 and 3.
Description: The assignment consists of 30 multiple choice questions (30 marks) and 4
problems (20 marks).
Note: See a later section on Submitting Assignments for details on submitting all assignments.
Assignment 2
Value:
10% of final grade
Due Date:
June 5, 2015
Purpose:
This assignment is based on the material in modules 4, 5 and 6.
Description: The assignment consists of 30 multiple choice questions (30 marks) and 4
problems (20 marks).
Assignment 3
Value:
Due Date:
Purpose:
10% of final grade
June 26, 2015
This assignment is based on the material in modules 7, 8 and 9.
Page 4 of 10
ECON 114.3 – Money and Income
Description: The assignment consists of 30 multiple choice questions (30 marks) and 4
problems (20 marks).
Assignment 4
Value:
10% of final grade
Due Date:
July 10, 2015
Purpose:
This assignment is based on the material in modules 10, 11 and 12.
Description: The assignment consists of 30 multiple choice questions (30 marks) and 4
problems (20 marks).
Note: See a later section on Submitting Assignments for details on submitting all assignments.
Assignment 5
Value:
10% of final grade
Due Date:
July 31, 2015
Purpose:
This assignment is based on the material in modules 13 and 14
Description: The assignment consists of 30 multiple choice questions (30 marks) and 4
problems (20 marks).
Final Examination
Value:
Due Date:
Purpose:
50% of final grade
August 14, 2015
A comprehensive examination on all of the material covered in all 14 modules.
Description: An invigilated, closed-book, three-hour examination. You are allowed to bring a
paper dictionary and a simple calculator with no programs or memories. No electronic devices
are allowed such as a cell phone, IPod or Blackberry.
There are two parts in the exam:
PART A:
60 Multiple Choice questions – 1 mark per question (60 marks)
PART B:
8 Short answer questions – 5 marks per question (40 marks)
NOTE:
Electronic devices (cell phones, Blackberries, electronic dictionaries, etc.) are
NOT permitted during the exam, with the exception of a paper dictionary and
simple calculator, without memory or e-mail functions.
The best preparation for the exam consists of reviewing the content and assignments of each
module. If you comfortably can perform the Learning Objectives, explain the Key Concepts, and
complete the Self-Study Exercises, you should do well on the final examination.
The day and time of your final examination will be listed in your PAWS account.
The location listed in PAWS for your exam is the Saskatoon location. If you want to write
your final exam outside Saskatoon, you must complete an Application for Final
Examination form, available at: https://ccde.usask.ca/exam-info This will let us know
where you would like to write your exam.
Students writing in Saskatoon do not need to complete this form.
Page 5 of 10
ECON 114.3 – Money and Income
Submitting Assignments
Submission forms and pre-addressed envelopes are included in your course materials package.
Assignments may be submitted by mail, fax, or in person if you have NO Internet access.
The preferred method of submitting assignments is through the course web site under
ASSIGNMENTS by the Blackboard Learn system.
Submitting Assignments in Blackboard Learn:
Please submit the assignment through the course web site under Assignments if you have
Internet access. Please post or fax your assignment only if you do not have Internet access.
1. Assignments must be typed and sent as a word document, NOT PDF.
2. Name your word document as: Econ 114.3 (X01) Assignment 1 - your name.
3. For the multiple choice part: Type in 1.A 2.B 3.C and so on . . . .
4. Graphs can be scanned and submitted separately.
5. 10% will be deducted for each day late. Ten days late will result in 0%.
To learn about how to submit an assignment:
http://www.usask.ca/its/courses/coursetools/stuAssignments/student_assignments.swf http://libr
ary.blackboard.com/ref/cfe7cf10-620a-43d2-ba13-7ac99b3cd1d2/index.htm
Other Options for Submitting Assignments:
•
•
•
By fax (with completed submission form) to CCDE at (306) 966-5245.
In person (with completed submission form) to the Main Office at the Centre for
Continuing and Distance Education (address below) Monday through Friday between
8:30 a.m. and 4:30 p.m. After Hours: Via the drop slot located at the top of the central
stairwell, on the Fourth Floor of the Williams Building (address below).
By mail (with completed submission form) to:
The Centre for Continuing & Distance Education (CCDE)
Room 464, Williams Building
University of Saskatchewan
221 Cumberland Avenue North
Saskatoon, SK S7N 1M3
Please note that assignments sent by mail should be postmarked no later than the due date,
and faxes should be sent prior to 4:30 p.m. Saskatchewan time on the due date.
You should keep a personal copy of all assignments submitted.
Additional Information
Must Pass Statement: Students must submit all five Assignments and write the Final
Examination in order to be eligible for a passing grade in this class.
Late Assignments: Assignments are due on the dates specified on the Course Schedule.
Assignments must be submitted on time; 10% will be deducted for each day late. Zero percent
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ECON 114.3 – Money and Income
will be given with 10 days late. An extension may be granted provided that a legitimate reason is
given; discuss with your instructor.
Students with Disabilities
If you have a diagnosed disability (learning, medical, physical, or mental health), you are strongly
encouraged to register with Disability Services for Students (DSS). In order to access DSS
programs and supports, you must follow DSS policy and procedures. If you suspect you may
have a disability, contact DSS for advice and referrals. For more information,
see http://www.students.usask.ca/disability/ or contact DSS at 306-966-7273 or dss@usask.ca.
Integrity Defined
“Integrity is expected of all students in their academic work – class participation, examinations,
assignments, research, practica – and in their non-academic interactions and activities as well.”
(Office of the University Secretary)
It is your responsibility to be familiar with the University of Saskatchewan Guidelines for
Academic Conduct. More information is available at
http://www.usask.ca/secretariat/student-conduct-appeals/IntegrityDefined.pdf
Module Objectives
Module 1 Introduction to Economics
1. Relate scarcity to the concepts of tradeoffs and opportunity cost.
2. Explain the use of marginal reasoning in decision making.
3. Demonstrate how incentives affect people’s behaviour.
4. Identify why trade among people or nations can make everyone better off.
5. Explain why markets are a good, but not perfect, way to allocate resources.
6. Examine how the economy works as a whole.
Module 2 Measuring a Nation’s Income
1. Illustrate why an economy's total income equals total expenditure.
2. Define GDP and how it is calculated.
3. Explain the four major components of GDP.
4. Examine other measures of income.
5. Explain the distinction between real GDP and nominal GDP.
6. Evaluate the use of GDP as a measure of well-being.
Module 3 Measuring the Cost of Living
1. Calculate the CPI and the inflation rate.
2. Compare dollar amounts from different years using the price index.
3. Explain why the CPI is an imperfect measure of the cost of living.
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ECON 114.3 – Money and Income
4. Differentiate between the CPI and the GDP deflator.
5. Differentiate between nominal and real interest rates.
Module 4 Production and Growth
1. Distinguish how economic growth differs around the world.
2. Explain productivity as a key determinant of a country’s standard of living.
3. Analyze the factors that determine a country’s productivity.
4. Examine how a country’s policies influence its productivity growth.
Module 5 Savings, Investment and the Financial System
1. Identify some of the important financial institutions in the Canadian economy.
2. Illustrate how the financial system is related to key macroeconomic variables.
3. Develop the supply and demand model for loanable funds in financial markets.
4. Apply the loanable funds model to analyze various government policies.
5. Determine the effect of government budget deficits and surpluses on the economy.
Module 6 Unemployment
1. Examine the data used to calculate the unemployment rate.
2. Explain how unemployment arises from the process of job search.
3. Explain how unemployment can result from minimum-wage laws.
4. Outline how bargaining between unions and firms can lead to unemployment.
5. Explain how unemployment can arise when firms choose to pay efficiency wages.
Module 7 Monetary System
1. Describe the kinds of money and its functions.
2. Explain the significance of the Bank of Canada.
3. Explain how banks create money.
4. Explain the tools that the Bank of Canada uses to influence the money supply.
Page 8 of 10
ECON 114.3 – Money and Income
Module 8 Money Growth and Inflation
1. Explain why inflation results from rapid growth in the money supply.
2. Explain the classical dichotomy and monetary neutrality.
3. Examine why some countries print excessive amounts of money, causing hyperinflation.
4. Summarize how the nominal interest rate responds to the inflation rate.
5. Examine the various costs that inflation imposes on society.
Module 9 Open-Economy Macroeconomics: Basic Concepts
1. Outline how net exports measure the international flow of goods and services.
2. Outline how net capital outflow measures the international flow of capital.
3. Explain why net exports must always equal net capital outflow.
4. Relate saving, domestic investment and net foreign investment.
5. Distinguish the meaning of the nominal exchange rate and the real exchange rate.
6. Examine purchasing-power parity as a theory of how exchange rates are determined.
7. Explain Canada’s small open economy and the implications of perfect capital mobility.
Module 10 A Macroeconomic Theory of the Small, Open Economy
1. Develop a model to explain the trade balance and the real exchange rate in a small open
economy.
2. Apply the model to explain the effects of government budget deficits on the trade
balance and the real exchange rate.
3. Use the model to analyze the macroeconomic effects of trade policies.
4. Apply the model to analyze political instability and capital flight.
Module 11 Aggregate Demand and Aggregate Supply
1. Identify the key facts about short-run economic fluctuations.
2. Explain how the economy in the short run differs from the economy in the long run.
3. Apply the model of aggregate demand and aggregate supply to explain economic
fluctuations.
4. Explain how shifts in either aggregate demand or aggregate supply can cause economic
expansions and recessions.
Page 9 of 10
ECON 114.3 – Money and Income
Module 12 The Influence of Monetary and Fiscal Policy on Aggregate Demand
1. Explain the theory of liquidity preference as a short-run theory of the interest rate.
2. Examine how monetary policy affects interest rates and aggregate demand in open and
closed economies.
3. Examine how fiscal policy affects interest rates and aggregate demand in open and
closed economies.
4. Evaluate the debate over whether policymakers should try to stabilize the economy.
Module 13 The Short-Run Trade-Off between Inflation and Unemployment
1. Explain why policy-makers face a short-run trade-off between inflation and
unemployment.
2. Explain why there is no trade-off between inflation and unemployment in the long run.
3. Examine how supply shocks can shift the inflation-unemployment tradeoff.
4. Determine the short-run cost of reducing the rate of inflation.
5. Examine how policymakers’ credibility might affect the cost of reducing inflation.
Module 14 Debates over Macroeconomic Policy
1. Summarize the debate concerning whether policymakers should try to stabilize the
economy.
2. Analyze the debate concerning whether monetary policy should be made by rule rather
than by discretion.
3. Criticize the debate concerning whether the central bank should aim for zero inflation.
4. Examine the debate concerning whether fiscal policymakers should reduce the
government debt.
5. Investigate the debate concerning whether the tax laws should be reformed to
encourage saving.
Acknowledgements
Course Author
Wendy Doell, M.A., MBA., University of Saskatchewan
Instructional Designer:
Jeanette McKee, B.Ed, M.Ed., CCDE, University of Saskatchewan
Page 10 of 10