BRAC University

MBA program
Spring 2022
Macroeconomics and Business Forecasting: ECO 502
Course Instructor:
Prof. Mirza Azizul Islam, Ph. D Contact: +8801552118864

Consultation: Students are encouraged to call me from 10.00am. to 9.00pm. and can also mail me if
they have any queries.

Text Books:

1. Rudiger Dornbusch, Stanley Fischer and Richard Startz. Macroeconomics, (Tata-McGraw-Hill), Ninth
Edition.
2. Mirza Azizul Islam (2014), Selected Macroeconomic Issues: Theory and Practice (Daily Star Books)
3. Additional Materials will be provided to the class, as needed.

Objective and Scope of Course:

Macroeconomic performance exerts significant influence on business in any country. Taking this into
account, the course will familiarize students with the basic macroeconomic objectives such as economic
growth, price stability, employment, income distribution and poverty. The main policy instruments that
are used to influence these variables are monetary, fiscal, international trade and exchange rate policies
as well as some other policies which impinge on a country’s participation in global economy. This course
will analyze how the macroeconomic system works and related policy implications with special
reference to Bangladesh. It will also examine the relevance of such analysis to business management.

Specific Learning Outcomes:

At the end of the course students are expected to become knowledgeable about the following:

(i) Elements which constitute a country’s gross domestic product (GDP) and national income.
(ii) Computation of GDP, inflation, poverty
(iii) Determinants of economic growth
(iv) Causes and consequences of inflation and policies to deal with undesirable rates of inflation.
(v) Application of the analytical technique of Aggregate Demand (AD) and Aggregate Supply
(AS) for understanding and forecasting economic growth and inflation.
(vi) Role of monetary, fiscal, trade, exchange rate and other policies related to participation in
the globalization process
(vii) Evolution and impact of aforementioned policies in Bangladesh.
(viii) Channels of transmission of the forces of globalization and their impact on Bangladesh.
(ix)
 Course Description and Topic-Wise Distribution

Topic 1. Understanding Meaning of Macroeconomics; Concept of growth; Chapter 1 of Text

Macroeconomics National productive capacity; Aggregate demand and book 1
supply; Inflation; Business cycle.

Topic 2. National Income Output; Payments to factors of production; GDP, GNP, Chapter-2 of Text
Accounting NDP, NI; national income identities- consumption, Book 1
savings, government, expenditure, investment; Price
index; GDP deflator.

Topic 3 Growth and Growth accounting in terms of capital and labour; other Chapters 3,4 of
Accumulation factors e.g. Natural resources, human capital, population Text book 1
growth, physical and social infrastructure.

Topic 4. Inflation Causes, consequences and cures Text book 2, pp

135-158

Topic 5. Aggregate Supply Aggregate supply and demand curve; Alternative supply Chapter-5 of Text
and Demand assumptions; supply side economics; Equilibrium and book 1
Price adjustment.

Topic 6. Macroeconomic Income and spending, Chapter 9 of Text

Model book 1

Topic 7. International Balance of payment; Trade; Capital mobility; Chapter-12 of text

linkages Globalization book 1 and pages
1-47 of text book
2

Format and procedures:

The format of the course will consist primarily of lectures. White Board will be used to highlight key
points and geometric figures/equations. Power points may also be used.

Students are strongly encouraged to follow lectures, specially for understanding Bangladesh
realities. They are also advised to ask questions in the class and will be required to make brief
presentations on the materials covered in the previous classes. Wherever appropriate, relevant
data/information on Bangladesh will be provided. The students are expected to take notes.
 Student evaluation will be based on attendance, quizzes, mid-term examination, assignment and
final examination.

Assessment:

Weights

1. Attendence 5 points

2. Quizzes/ class tests 15 points

3. Assignment/ Term paper 15 points

4. Midterm Exam 25 points

5. Final Exam 40 points

Total Marks 100 points