Business School FCCU

Economic Applications for Business BUSN-225

Spring 2020

Credits: 3

Schedule

•Class Schedule Days and Timings:

Section C: Monday-Wednesday-Friday from 09:00 AM to 09:50AM

Section D: Monday-Wednesday-Friday from 10:00 AM to 10:50 AM

Section E: Monday-Wednesday-Friday from 11:00 AM to 11:50AM

Section F: Monday-Wednesday-Friday from 12:00 AM to 12:50AM

•Venue - Location/ Room:

Section : E-331

Section : E-332

Section : E-332

Section : E-332

Instructor:

•Name: Umar Sharif

• Location: (Instructor will be available to students in Business Lounge with prior

appointment, feel free to contact via email):

•Contact: Email umarsharif@fccollege.edu.pk

Course Description and Outline:

Pre-requites: Busn 121

Aims:

This Course of will explore such topics as economic growth, business cycles, the structure of the
economy, employment and unemployment, inflation, and government monetary and fiscal policy. To
some extent I hope to show you how economists identify and think about economic problems. There is
some exposure to theory and modeling in this course you can see how we organize general economic
concepts into analytic models. The main objective of this course is to make students aware of the various
macroeconomics policies and their impact on the businesses.
Learning Outcomes:

On successful completion of this course, students should be able to:

CLO # Description
1 Explain the basic concepts of macroeconomic issues.

2 The efficient use of scare resources, Allocation of scarce resources by using factors of
production effectively, the impact of price levels on Aggregate demand / supply and clear
analysis of National income.

3 Explain the problems and performance of different sectors of the economy.

4 The meaning of unemployment and inflation data and how that data is collected and
computed.
5 The meaning of the business cycle and its phases.
6 To manipulate the basic Aggregate Supply, Aggregate Demand model of the macro economy.
7 How fiscal policy operates, its tools, and its advantages and drawbacks.
8 How monetary policy operates, its tools, and its advantages and drawbacks.
9 How a fractional reserve banking system works

Learning Process:

Lectures and tutorials will form the basis of delivery, but you may also be responsible for solving
problems/questions on your own. Discussions will be encouraged.

Scheme of Work: Subject to change as required

1ST and 2nd week  Describe the circular flow of income and output
 Define gross domestic product (GDP) and explain its limitations
Chapter 8 Miller  Explain the expenditure and income approaches to tabulating GDP
 Discuss the key components of national income
 Distinguish between nominal GDP and real GDP

3rd and 4th week  Define economic growth and recognize the importance of economic
Chapter 9 Miller growth rates
 Explain why productivity growth and saving are crucial for maintaining
economic growth
 Describe how immigration and property rights influence economic
growth
 Discuss the fundamental elements that contribute to a nation’s
economic development
 Evaluate whether the U.S. economy has entered a period of stagnant
economic growth

5th and 6th week  Discuss the concept of long-run aggregate supply and describe the effect
Chapter 10 Miller of economic growth on the long-run aggregate supply curve
 Explain why the aggregate demand curve slopes downward and list key
factors that cause this curve to shift
 Evaluate the meaning of long-run equilibrium for the economy as a
whole and explain why economic growth can cause deflation
 Evaluate the likely reasons for persistent inflation in recent decades

7th and 8th Week  Explain how the government calculates the official unemployment rate
Chapter 7 Miller  Discuss the types of unemployment
 Describe how price indexes are calculated and define the key types of
price indexes
 Evaluate who loses and who gains from inflation and distinguish
between nominal and real interest rates
 Understand key features of business fluctuations

Quiz and Mid Term Exams

9th and 10th Week  Use traditional Keynesian analysis to evaluate the effects of discretionary
Chapter 13 and fiscal policies
Chapter 14 Miller  Discuss ways in which indirect crowding out and direct expenditure
offsets can reduce the effectiveness of fiscal policy actions
 Describe how certain aspects of fiscal policy function as automatic
stabilizers for the economy
 Explain how federal government budget deficits occur and define the
public debt
 Analyze the macroeconomic effects of government budget deficits
 Describe possible ways to reduce the government budget deficit.
11th and 12th Week  Define the functions of money, identify key properties that money must
Chapter 15 possess, and explain official definitions of the money supply
Money, Banking, and  Understand why financial intermediaries such as banks exist
Central Banking  Describe the basic structure and functions of the Central Bank.
 Determine the maximum potential extent that the money supply will
change following a CB monetary policy action

13th and 14th Week  Identify key factors that influence the quantity of money that people
Chapter 16 desire to hold
Domestic and  Describe how Federal Reserve monetary policy actions influence market
International interest rates
Dimensions  Evaluate how expansionary and contractionary monetary policy actions
of Monetary Policy affect equilibrium real GDP and the price level in the short run
 Understand the equation of exchange and its importance in the quantity
theory of money and prices

15th and 16th Week  Distinguish between the balance of trade and the balance of payments
Chapter 33 and identify the key accounts within the balance of payments
Exchange Rates and  Explain the demand and supply of foreign exchange
the Balance of  Outline how exchange rates are determined in the markets for foreign
Payments exchange and discuss factors that can induce changes in equilibrium
exchange rates
 Understand how policymakers can go about attempting to fix exchange
rates

Prescribed Text:

Economics Today by Roger Miller (Ebook on Moodle)

Additional Recommended Text (Ebook available on request)

Economics Principles, Problems and Policies by McConnel L Brue 18th Edition

Reference Book(s)
 1. “The Economics of Money, Banking and Financial Markets” frederic s. mishkin , 6 th
edition

2. “ECONOMICS” by Roger Arnolds

3. Mankiw, “Principles of Macroeconomics”.4th Edition

4. Samuelson, N. “Economics”, 18th Edition

5. Jackson & Mclver, “Macroeconomics”, 7th Edition.

6. Dornbusch, Fischer & Startz. “Macroeconomics”, 7th Edition

7. Frank and Bernanke, “Principles of Economics”.

8. Walash, S. “Economics”, 3rd edition.

9. Lieberman, M. and Hall, R. “Introduction to Economics”.

10. Foundations of Macroeconomics, 6e (Bade/Parkin)

11. Macroeconomics, theories, policies and international Applications. Roger Leroy Miller
and David D.VanHoose.3e.

12. Principles of Macroeconomics, Ben S. Bernanke, Nilss Olekalns Robert H. Frank.

13. Economics by John Sloman 6e.

14. Economics by R.G Lipsey and P.N courant

Other Recommended Readings:

1) Harvard Business Review

2) The Economist
3) The Business Recorder
4) Economic and Business Review (Daily Dawn).
5) Annual reports of State bank of Pakistan.
6) Economic Surveys: Govt. of Pakistan.
7) Articles in News papers/Magazines.

Assessment Strategy:
 Description/Details Weightage
Attendance / Class Behavior and
10
participation
Quizzes and Surprise Test (Minimum 2) 10
Mid Term Exam 30
Final Exam 50
Total 100

 FCCU Grading criteria will be applied to final weightage.

 Exams will be based on conceptual/analytical MCQs and short analytical questions.

Important Notes:

 Two late comings will count as one absent.

 No marks will be awarded for attendance beyond seven absentees.
 All quizzes will count for the aggregate quiz marks, so make sure you do not miss any.
 You are advised to be aware of any activities/tasks assigned in case you were absent.

Late Submissions:

The university requires students to adhere to submission deadlines for any form of assessment.
Authorization of the late submission of work requires written permission. The Head of Department with
responsibility for the module, or one named alternative (usually the module tutor), will be authorized to
give permission for one extension period of between 1 and 10 working days where evidence of
circumstances has been accepted and where submission within this timescale would be reasonable taking
into account those circumstances. All work submitted later than 10 working days after the published
submission date will be awarded a mark of 0%.

Extenuating Circumstances and Poor Performance:

Students who are unable to submit work within 10 working days after the submission date due to
verifiable extenuating circumstances which are serious and exceptional, may submit a case for
consideration in accordance with the University’s Extenuating Circumstances Procedure.

The university operates a universal scheme for the submission of extenuating circumstances. If you feel
that you have extenuating circumstances than you need to submit an envelope marked ‘’Extenuating
Circumstances’’ with all your details like the year of study, the name of the student, the name of the
course leader and of course with the relevant documentary evidence such as medical certificates.

Cheating, Plagiarism and Using Unfair means to Enhance Performance:

The University regards any use of unfair means in an attempt to enhance performance or to influence the
standard of award obtained as a serious academic and disciplinary offence. Unfair means include all
forms of cheating, plagiarism and collusion.

All instances or allegations of the use of unfair means will be investigated.

It is therefore essential that you acknowledge an author’s work that you may have used to support an
argument in any of your assignments.

Plagiarism is a particular form of cheating that the university is concerned about. All work that is
submitted for assessment must be genuinely your own work and not the result of plagiarism. If you are
quoting actual words from a published or unpublished text you must use quotation marks and cite your
source. In order to avoid accusation of plagiarism you should use the Harvard Referencing System. This
will ensure that there is no ambiguity.

You must also not pass work off as the result of your individual efforts, if you have infact colluded with
other students to prepare the piece of work jointly, or you have copied each other’s work. Clearly, it is
also wrong to copy another student’s work without them knowing about it.

You are advised to read the extract on this subject in the university Regulations. If you have any doubts
on this important matter, you are advised to speak with the module tutor or course Leader.

IMPORTANT!!!!

Mobiles phones & other electronic gadgets (except non-programmable calculators) are strictly prohibited
& participants are not allowed to carry these [even if turned off/silent] in the examination room during 2
hours of examination. If any participant is found guilty during examination timings [for whatever reason],
he shall be disqualified from that examination and shall be awarded Grade "F" for that course.

Instructor…………….. HOD……………… Dean………….