# ECON 202

Introduction

tr .edu.INTERMEDIATE MACROECONOMICS  Instructor: Pınar Derin-Güre  Class Hours: Tuesdays 10:40-13:30 IE04  Office Hours: Thursday 13:30-15:30 or by email appointment  e-mail: pderin@metu.

macroeconomics 5/e by prentice hall. economic growth and unemployment. Main text: Blanchard. Web page: http://online.tr   Class .edu.Course Syllabus:  Intermediate course on macroeconomics that will introduce you a toolkit about macroeconomic issues like inflation.metu.

3) Problem sets and end of chapter questions (totally 15%). 2) Final exam (45% cumulative).5% Unannounced quizzes 5% (totally 10%) Class participation 2.Course Syllabus:  Grading information 1) One midterm (30%). 4)Class attendance 2.5% .

. Collaboration during exams and quizzes are forbidden.Course Syllabus:  Course Policy: Collaboration on problem sets is permitted but please write up your answers separately.

Course Syllabus:  Absences: No credit will be given for a missed examination.  Attendance will be a part of your grade. quiz or failure to hand in a problem set on time unless the student has an important excuse with a documented proof. . Missing two or more classes is not acceptable.

Keys for a good grade and a better understanding of material:  Read the required readings(mainly from the text)  Attend classes. sample midterms and final yourself ask questions. and office hours  Solve the problem sets.  Try to learn the material do not mechanically memorize anything. .  Feel free to ask questions in the class.

Prerequisites:  Completion of introductory macroeconomics ECON 102 (or ECON212) is required. of algebra is important  Knowledge  Knowledge of calculus is a plus but I will give alternative explanations as well. .

consulting jobs use macroeconomics knowledge. BDDK. Check the list that I posted online. . Turkish Treasury. Mınistry of Finance. Many successful examples. Future carrers: Central Bank of Turkey. Banks. Not only ındustrial engineers but all voters should know economics As an interdisciplinary(?.Why should an Industrial Engineer know Macroeconomics?     Can pursue an academic career in economics. do not take it offensive) engineering a production decision without a proper knowledge in economics would be wrong.

INTRODUCTION  What  How  Why is macroeconomics? does it differ from microeconomics? is it important to learn macroeconomics? .

Main macroeconomic variables:  OUTPUT /GDP : Aggregate level of production in the economy and its rate of growth  UNEMPLOYMENT RATE: U/L U (Unemployed): # of not employed but actively looking for a job L (Labor Force): U+E: total # of employed plus unemployed  INFLATION RATE: Rate at which prices are increasing over time .

3. Fiscal Stimulus and Monetary expansion in the world. financial crises by mortgage backed securities.Recent economic and financial crisis in the world-I  Late 2000s Financial Crisis: Credit Crunch/Global Financial Crisis Collapse of Financial Institutions Bailout of banks by governments Downturns in the stock market 1. Trigger: Liquidty shortfall in US in 2008: Housing crises in US. 2. .

Recent economic and financial crisis in the world. outside EU Iceland. Public debts as a percentage of GDP was very high in these countries.65% (2011)  . Sovereign debt crises is caused by the sovereign debt default fear: potential bond purchasers are afraid that government will be able pay its debt back.II European Sovereign Debt Crises.Late 2009-2010 Greece.5% (2007) to 26. Interest rate on 2 year Greek bonds increased from 4. Portugal. Ireland. Spain.

Recent economic and financial crisis in the world-III US Debt-Ceiling Crises in 2011 Us congress increased the debt.ceiling and reduced future government spending. (Budget control act 2011) Standard and Poors downgraded US ratings for the first time in history. Very volatile effect in the stock market ( biggest fall since 2008 crisis) Tight fiscal policies might be needed (taxes on rich can be raised)  .

Economic Problems in Turkey      High Current Account Deficit that might trigger an economic crisis Growth rates seem to be high today but does it really make the poor better off? Income İnequality ( Labor prductivity rising but workers wages do not increase that much) High Budget Deficits Still on the rise and high inflation rates (more than 6%) Informality and tax evasion and avoidance resulting in high consumption taxes. .

the contemporary readings(from newspapers and economist that I assigned)  Do . No questions will be asked from this chapter.NEXT CLASS  Required Reading: Chapter 2/ Tour of the Book  Read Chapter 1 for fun.