Department and Course #: Course Title: Academic Term: Class Time: Academic Division: Instructor: Telephone Number: Email: Website: ECON 101 PRINCIPLES OF MACROECONOMICS FALL 2009, SESSION I TUESDAY AND THURSDAY, 5:45p-8:00p SOCIAL SCIENCES TOM SCHENK 515-481-0774

ACADEMIC MAJOR GOALS AND OBJECTIVES 1. Demostrate abilities to conduct research to access relevant information and then communicate the results of the research to others in written and oral format. 2. Demonstrate abilities to work in a team environment, as a leader and as a follower, to generate solutions to specific situations. 3. Develop skills in analyzing business situations and recommend courses of action that show a thorough understanding of the internal and external envorments. INSTRUCTIONAL OBJECTIVES *Learning as Knowledge The student will: 1. Identify the definition(s) of economics and macroeconomics 2. Identify the basic principles of the law of supply, law of demand, and market equilibrium. 3. Identify and understand the principles of unemployment, interest rates, fiscal, and monetary policy. 4. Understand the economy as a system. *Learning as Process or Behavior The student will: 1. Relate political economy systems to the U.S. and other economies. 2. Study how the market system allocates products and services to consumers. 3. Apply economic theory in real-world applications 4. Learn how policy affects all the elements of the economy. *Learning as Attitude The student will: 1. Appreciate the basic underlying dilemma of economics. 2. Develop an awareness of how economics impacts their daily lives. 3. Appreciate the complex interactions in an economy. CONTENT OUTLINE • Elements of economics: political economy, science, and moral philosophy • Economic institutions • Trade-offs (opportunity cost) and the formation of an economy

• Supply and Demand: individual choice to market equilibrium • Economic Growth and Decline – recessions and booms
• Inflation and Unemployment • Measuring economic activity


• Building a model of economic activity • Monetary and Fiscal Policy Time permitting: • Loan defaults and the financial crisis • Current economic policy and the potential effects INSTRUCTIONAL PROCEDURES Instructional procedures for this course will include lectures, class discussions, “company” (group) exercises, case analysis, and individual assignments. Students will successfully pass the class if they aforementioned activities. INSTRUCTIONAL RESOURCES

1. Textbook: Economics by David Colander, 7th Edition, McGraw-Hill, Irwin: 2006
ISBN: 0-07-340286-9 Times

2. Periodicals: The Economist, The Wall Street Journal, The Des Moines Register, New York 3. Blogs: See Homework #1 4. Course website:

Y = 0.2 • E1 + 0.2 • E 2 + 0.3 • F + 0.2 • A + 0.07 • P + 0.03 • C
Y = total score; E1 = Exam 1 E2 = Exam 2 F = Final A = Assignments P = Participation C = Company Score Exams: Two exams will be administered throughout the semester. The exams will consist of a multiple choice, argument, and long problems. Multiple choice questions will test basic economic vocabulary and elementary relationships. Argument questions will ask the student to reply to a normative statement using economic reasoning taught in class. I may use quotes from recent periodicals and/or blog posts. Finally, long problems will be multi-part and will test whether the student can work through an economic model. Each exam will implicitly be cumulative insofar as the principles of economics are tightly intertwined, but the emphasis will be on the contemporary lesson. Final: The final will explicitly be cumulative, although the emphasis will be slightly more on the latter third of the class. The format will be similar to exams: multiple choice, essay, and long problems. The test is worth slightly more and, thus, will be slightly longer than exams. Assignments: Assignments will be given throughout the semester through the course website. Homework will be distributed on Tuesday and will be due at the beginning of the following Tuesday. Assignments will be graded using the following metric: 0 = did not turn in; 1-2 = tried without serious effort; 3-4 = tried with effort; 5=(nearly) perfect Assignments are not meant to be taxing, but to help the student prepare for exams and the final. Most assignments will involve a question that will resemble an exam’s ‘long problem.’ Participation: Students are expected to regularly participate in classes and, if not in class, in out-of-class communication with the professor. Lack of participation and irregular attendance will be especially noticed if the student is struggling in class. The professor will warmly reward struggling students who seek help through email and questions. Company Score: Students will be randomly assigned to companies of 3 to 4 individuals, depending on the final class size. Companies will accumulate points throughout the semester based on exams, assignments, participation, and any other metric the professor feels is appropriate. These activities are meant to be fun and introspective, while being educational. At the end of the semester, points will be assigned as the inverse of


company rank multiplied by 100, e.g., first place: (1/1)*100 = 100, second: (½)*100 = 50, etc. The company score is especially helpful toward boarderline students. Final Grade: Letter grades will be assigned as follows: A = 90-100% B = 80-89% C = 70-79% D = 60-69% F = < 60% MISSED EXAMS AND ASSIGNMENTS Assignments will be due at the beginning of class every Tuesday and tests will be given on the days denoted below. Late assignments will be penalized 40 percent. Students must notify the professor of an upcoming absence. Students will be allowed to make up exams ONLY when the professor received prior notification for the inability to complete the exams. In extreme cases where prior notification is impossible, the student must provide written documentation—not by the student—explaining the absence. Students who miss a test for an unexcused absence will receive a zero. ATTENDANCE Students will be expected to attend every class. Attendance in the first week is mandatory. Irregular attendance will be reflected in participation and company exercise scores. Those who already anticipate missing two or more classes are encouraged to enroll at another time. Those who are dropped from class due to absences may lose financial aid. WRITING AND CRITICAL THINKING Modern economics is intensely mathematics, but few people possess the training to grasp a mathematical model. As such, economics is typically communicated in written periodicals so it is no coincidence that well-known economists tend to be good writers—e.g., Paul Krugman, Herny James, John Gailbraith, and Milton Friedman. Employers often lament and seek those with sharp writing ability. Although writing ability is hard to notice during an application procedure, employers will often quickly promote those who effectively communicate. This class will challenge student to reply to assertions during an examination. Students will need to synthesize economic theory and writing to convince the professor the original argument was either fallacious or correct. This experience will be different from writing an essay or research paper. Argument portions of the exam will give the student little room to wonder or “add fluff”. TENTATIVE SCHEDULE & READINGS Economics is truly an interdisciplinary subject involving political theory, moral philosophy, mathematics, and elements of all social sciences. This course will be based around the cold logical and mathematical aspects often satirized in TV and movies. However, this class will also overtly emphasis applications of economic theory and briefly highlight the moral philosophy and political philosophy elements. Readings are divided into three tiers: mandatory (***), suggested (**), and voluntary (*). Mandatory readings should be completed prior to the beginning of class, with the exception of the first week. Suggested readings are not mandatory, but will help the student understand the mandatory content if needed. The suggested readings will often re-explain the material from a slightly different perspective, much like the function of this sentence to the former sentence. Lastly, voluntary readings are tangential to the topic—interesting, but not necessary knowledge for the class. These readings will delve into political theory, philosophy, and other classical writings that will add to the student’s comprehensive knowledge. Students will not be tested over the material and absolutely should complete other assignments first. I hope this syllabus will be a resource for the student after the class has been completed.


25 Aug: Review of the syllabus and introduction What is Economics? ***Chp. 1 – Colander **An Essay on the Nature & Significance of Economic Science. Lionel Robbins, 1945: **“Politics versus Economics” in Applied Economics: Thinking Beyond Stage One. Thomas Sowell, 2004: pp. 1-29. *(Negative Liberty) “Economic Liberalism—introduction” in Western Liberalism: A History in Documents from Locke to Croce. Eds. E.K. Bramsted and K.J. Melhuish, 1978: pp. 250-258. *(Socialism) “The Elements of Socialism” in The Strength and Weakness and Socialism. Richard T. Ely, 1899: pp. 9-18. *(Corporatism) “Economic Fascism” by Thomas J. Dilorenzo in The Freeman: Ideas on Liberty. Foundation for Economic Education, Vol. 44(6): 1994 Economic institutions ***Chp. 3 – Colander Guns and butter: opportunity cost and the beginnings of an economy 27 Aug: Production possibilities frontier ***Chp. 2 – Colander **Chp. 2, Appendix A – Colander Supply, demand, and equilibrium ***Chp. 4 – Colander Algebra Review Find your favorite algebra book and/or begin Chp. 5, Appendix A – Colander, pp. 121-123 1 Sep: Supply, demand, and equilibrium (con’t) ***Chp. 4 – Colander 3 Sep: The Macroeconomy: Growth, Business Cycles, and Inflation ***Chp. 22 – Colander 8 Sep: TEST #1 (Chps. 1 – 4) 10 Sep: The Macroeconomy: Growth, Business Cycles, and Inflation ***Chp. 22 – Colander 15 Sep: Primordial Question: Growth and the Wealth of Nations ***Chp. 8 – Colander *F.A. Hayek, “The Use of Knowledge in Society.” American Economic Review. September 1945. *James A. Kagn and Robert W. Rich, “Tracking Productivity in Real Time.” Current Issues in Economics and Finance. Vol. 12(8), November 2006. 17 Sep: Model Building: The Keysian Model – AD/AS ***Chp. 25 – Colander 22 Sep: Model Building II: Multipliers ***Chp. 26 – The Multiplier Model 24 Sep: Test (Chps. 22 – 26) 29 Sep: Money ***Chp. 27 – Colander ***Chp. 27, Appendix A – Colander 1 Oct: Monetary Policy & How Economists Were Once Wrong ***Chp. 28 – Colander 6 Oct: Fiscal Policy ***Chp. 30 – Colander 8 Oct: Current Events (TBD) 15 Oct: Final (Chps. 1 – 4, 22 – 28, 30; emphasis on 22-28, 30)


Revised: 4/13/04, 6/24/05, 8/01/06, 12/21/06, 6/04/07

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(continued on reverse side)

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