College of Business Management

Macroeconomics (ECO102)
COURSE OUTLINE
Course Title and Code: Macroeconomics (EC0102)

Total Credit hours: 45 hrs

Duration: 26 sessions (1 ½ hrs per session)

1. Overall aims of course

This is an introductory level course in macroeconomics that introduces basic understanding of macroeconomic
issues. The course emphasizes the broad applicability of a set of core economic ideas (such as the production
function, the trade-off between consuming today and saving for tomorrow, and supply-demand analysis). Using
these core ideas to build a theoretical framework (model) that encompasses all the macroeconomic analyses i.e.
long-run and short-run, open-economy and closed-economy, and classical and Keynesian perspectives. Students
at the end of this course have a clear understanding of how important economic variables such as inflation,
unemployment, or aggregate income are interlinked.

2. Intended learning outcomes of course (ILOs)

 To give a broad overview of the main currents of macroeconomic theory
 To introduce students to the most important ideas, models and research methods used in
macroeconomics
 To introduce major sources of economic data available for Pakistan and for other countries worldwide.
 To use economic data series to test various macroeconomic models studied in this course.

3. Course Contents:

SESSION TOPICS CHAPTER

Introduction to Macroeconomics, what macroeconomists
1-2 Study and why macroeconomists disagree Chapter 1 - AB
3-5 The Measurement and Structure of the National Economy,  Chapter 2 - AB
Income, Expenditure, and the Circular Flow, Saving and
Wealth , various measures of income, inflation and interest
rate.
6-8 The Production Function, the demand and supply for labor and  Chapter 3 - AB
the factors that shift demand and supply of labor, labor market
equilibrium. Unemployment and relationship between output
and unemployment.
 9-10 Consumption, Saving, and Investment. The factors that  Chapter 4 - AB
changes consumption and investment behavior. Goods Market
Equilibrium.
11-13 Saving and Investment in the Open Economy. Balance of  Chapter 5 - AB
Payments Accounting. Saving and Investment in a
Small/Large Open Economy. Goods Market Equilibrium
in an Open Economy
14-16 The Asset Market, Money, and Prices. Portfolio Allocation  Chapter 7 - AB
and the Demand for Assets. The Demand for Money, Asset
Market Equilibrium. Money Growth and Inflation
17-18 Business cycles, Business Cycle Facts and analysis  Chapter 8 - AB
19-22 The IS-LM AD-AS Model: A General Framework for  Chapter 9 - AB
Macroeconomic Analysis. The FE Line, Factors That Shift the
FE Line, The IS Curve, Factors That Shift IS Curve, The LM
Curve, Factors That Shift LM Curve, General Equilibrium in
the Complete IS/LM Model. Aggregate Demand Curve,
Aggregate Supply Curve, Equilibrium in the AD/AS Model
23-24 Unemployment and Inflation  Chapter 12 - AB
25-26 Exchange Rates, Business Cycles, and Macroeconomic Policy  Chapter 13 - AB
in the Open Economy

4. Teaching and learning methods

 Class room lectures

 Research Articles / Assignments
 Presentations & Individual Report
5. Student assessment methods

Midterms …………………………………. 30
Final ………………………………… 40
Assignments/CP………………………………… 10
Quizzes ………………………………… 10
Term Report ……………………………….. 10

TOTAL 100
6. Recommended Texts:
 Macroeconomics, by Andrew B. Abel and Ben S. Bernanke (Addison Wesley, 8th edition)
 N. Gregory Mankiw, Macroeconomics, 8th edition
 R. Dorn Busch, Stanley Fisher & Richard Startz, Macroeconomics, International edition