Parkes' Principles of Macroeconomics Assignments Page

Fall 2019, Section 5

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 Tentative Schedule and Course Assignments:

                    Week 14




November 26, 2019      Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand - continued


• Review the Exam
• Chapter 21: Fiscal Policy and Aggregate Demand
  • Fiscal Policy: Government Spending and Tax Revenue Policy
    • Government Policy - Calculating changes in Government Spending and Taxes
    • Quiz - Scenario #3: Balanced Budget Effect
  • MPC + MPS = 1
  
  
• Activist Policy: DO SOMETHING!!!
  • The Economy is in a Recession: Increase G or Decrease T
  • Fiscal Policy Lags - up to 2 years to enact fiscal policy and take effect on the economy!
  • Lags may mean the economy is already back to long-run and NOT in a Recession anymore!
• Quiz : Scenario #4: Fiscal Policy lag, with Self-correcting Mechanism
  
  
• Monetary Policy response to Stabilize the Economy (Scenario #5)
• PowerPoint for Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand



November 28, 2019      HAPPY THANKSGIVING!!!






                 Week 15



December 2, 2019      Chapter 18: Open-Economy Macroeconomics: Basic Concepts


• Chapter 18: Open-Economy Macroeconomics: Basic Concepts
  • International Flows of Goods and Capital
    • Net Exports = Net Capital Outflows
    • Saving = Investment revisited
  • Prices for International Transactions: Nominal versus Real exchange rates
  • Purchasing Power Parity
• PowerPoint for Chapter 18: Open-Economy Macroeconomics Basic Concepts


December 4, 2019      Chapter 18: Money Growth and Inflation continued



• Chapter 18: Open-Economy Macroeconomics: Basic Concepts
  • Prices for International Transactions: Nominal versus Real exchange rates
  • Purchasing Power Parity
  • Chapter 19: A Macroeconomic Theory of the Open Economy
    • Supply and Demand for Loanable Funds and for Foreign Currency Exchange
      • Alteration in the S & D for LF
• PowerPoint for Chapter 18: Open-Economy Macroeconomics Basic Concepts









      Week 16


December 12, 2019: 10:00 am to 12:00 (Noon)      FINAL EXAM - ALL Chapters covered

     PAST ASSIGNMENTS:

                    Week 13



November 19, 2019      REVIEW



• REVIEW FOR THE EXAM
• Any unfinished discussion of Stabilization Policy, Activist versus Nonactivists, Fiscal and Monetary Policy



November 21, 2019      Exam 3, Chapters 16 & 17, and Chapters 20 & 21





                 Week 12



November 12, 2019      Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand - continued


• Chapter 20: Aggregate Demand and Aggregate Supply continued - Review concept - SRAS shifts, SR Equilibrium to LR
  • Over time ... the Self-correcting mechanism: wages adjust, business costs adjust, price expectations adjust SHIFTING SRAS
  • Over time the Long-run Equilibrium is reached
  • Stagflation
• Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand continued
  • How Monetary Policy Influences Aggregate Demand
  • The Theory of Liquidity Preference
    • Money Supply, Money Demand, and Equilibrium
  • PowerPoint for Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand


November 14, 2019      Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand continued



• Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand - continued
  • How Monetary Policy Influences Aggregate Demand
• The Theory of Liquidity Preference
  • Money Supply, Money Demand, and Equilibrium
  • The Downward Slope of the Aggregate Demand Curve
  • Changes in the Money Supply
• The Role of Interest Rate Targets in Fed Policy
• The Zero Lower Bound
• How Fiscal Policy Influences Aggregate Demand


• Chapter 21: Fiscal Policy and Aggregate Demand - the Multiplier - starting with PPT slide #21
  • PowerPoint for The Multiplier - a brief review from the class
  • Fiscal Policy: Government Spending and Tax Revenue Policy
    • Government Policy - Quiz #?? - Calculating changes in Government Spending and Taxes and The Answers
    • Quiz - Scenario #3: Balanced Budget Effect
  • MPC + MPS = 1
  
  
• Activist Policy: DO SOMETHING!!!
  • The Economy is in a Recession: Increase G or Decrease T
  • Fiscal Policy Lags - up to 2 years to enact fiscal policy and take effect on the economy!
  • Lags may mean the economy is already back to long-run and NOT in a Recession anymore!
• Quiz : Scenario #4: Fiscal Policy lag, with Self-correcting Mechanism
  
  
• Monetary Policy response to Stabilize the Economy (Scenario #5)
• PowerPoint for Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand





                 Week 11



November 5, 2019      Chapter 20: Aggregate Demand and Aggregate Supply


• Chapter 17: Money Growth and Inflation continued
  • The Fisher Effect
  • The Costs of Inflation
    • A Fall in PP? The Inflation Fallacy
    • Shoeleather Costs
    • Menu Costs
    • Other Costs
  • The Wizard of OZ
• PowerPoint for Chapter 17 Money Growth and Inflation
  
  
• Chapter 20: Aggregate Demand and Aggregate Supply
  • Why the Aggregate Demand Curve Shifts: C, I, G, NX
• The Aggregate Supply Curve
  • Vertical Long-Run AS
  • Shifts in the LRAS: Land, Labor, Capital, Technology
  • Short-Run Aggregate Supply
• Quiz #13 - Scenario #1 - Brexit, or recession abroad
• PowerPoint for Chapter 20: Aggregate Demand and Aggregate Supply


November 7, 2019      Chapter 21: The Influence of Monetary and Fiscal Policy on Aggregate Demand


• Chapter 20: Aggregate Demand and Aggregate Supply continued - LONG-RUN shift, Note the SRAS shifts too
  • Scenario #2 - Long-run Shift (SRAS too)"Hydraulic Fracking" The Price level falls and Potential Output rises
  
  
  

                   Week 10
  
  

October 29, 2019      Chapter 16: The Monetary System continued


• Chapter 16: The Monetary System continued
  • Banks and the Money Supply
    • 100% Reserve Banking
    • Money Creation and Fractional Reserve Banking
  • The Fed's Tools of Monetary Policy
    • About the Fed, Website
    • Interac - A Not-for-profit Canadian eTransfer system
    • How the Fed influences the Quantity of Reserves
    • How the Fed Influences the Reserve Ratio
    • Problems in Controlling the Money Supply
    • Quiz 12and the Answers
  • Federal Reserve Basics - PowerPoint shown in class
• PowerPoint for Chapter 16 The Monetary System


October 31, 2019      Chapter 17: Money Growth and Inflation


• Chapter 17: Money Growth and Inflation
  • The Classical Theory of Inflation
    • The Level of Prices and the Value of Money
    • Money Supply, Money Demand, and Monetary Equilibrium
    • The Effects of a Monetary Injection
    • A Brief Look at the Adjustment Process
    • The Classical Dichotomy and Money Neutrality
    • Velocity and the Quantity Equation
  • The Inflation Tax
  • The Fisher Effect
  • The Costs of Inflation
    • A Fall in PP? The Inflation Fallacy
    • Shoeleather Costs
    • Menu Costs
    • Other Costs
  • The Wizard of OZ
• PowerPoint for Chapter 17 Money Growth and Inflation




                 Week 9



October 22, 2019      Chapter 16: The Monetary System
• Review the exam
• Chapter 16: The Monetary System
  • The Meaning of Money
    • The 3 Functions of Money
    • The 2 Kinds of Money
    • M1 and M2
• PowerPoint for Chapter 16 The Monetary System


October 24, 2019      Chapter 16: The Monetary System continued
• Chapter 16: The Monetary System continued
  • The Federal Reserve System
    • The Fed's Organization
    • The FOMC
  • Banks and the Money Supply
    • 100% Reserve Banking
    • Money Creation and Fractional Reserve Banking
  • The Fed's Tools of Monetary Policy
    • About the Fed, Website
    • How the Fed influences the Quantity of Reserves
    • How the Fed Influences the Reserve Ratio
    • Problems in Controlling the Money Supply
    • Quiz 11 and
    Answers
• PowerPoint for Chapter 16 The Monetary System





                 Week 8



October 15, 2019      Chapter 15: Unemployment


• Chapter 15: Unemployment
  • Identifying Unemployment
    • How is unemployment Measured?
    • What is the Labor Force?
    • The Labor Force Participation Rate
  • The Natural Rate of Unemployment
  • Cyclical Unemployment
  • Frictional Unemployment and Structural Unemployment
  • Discouraged Workers
• PowerPoint for Chapter 15 Unemployment



October 17, 2019      Exam 2, Chapters 10 - 13, and 15





                 Week 7



October 8, 2019      Chapter 13: Saving, Investment, and the Financial System


• Chapter 13: Saving, Investment, and the Financial System
  • Financial Markets
    • Stock Market
    • Bond Market
    • Financial Intermediaries
    • Banks, Mutual Funds, Etc.
  • Saving and Investment in the National Income Accounts
  • Identities: Investment = private saving + public saving
• The Market for Loanable Funds
  • 3 Very Important Graphs:
    • Policy 1: Saving Incentives
    • Policy 2: Investment Incentives
    • Policy 3: Government Budget Deficits and Surpluses
  • Crowding out and the Public Debt
• PowerPoint for Chapter 13: Saving, Investment, and the Financial System
  
  


October 10, 2019      NO CLASS: In K.C. at the MVEA Conference presenting a paper, etc.



• Due October 10, before 11:59 pm. Paper #1 Due in Bb Learn: Minimum Wage: Where are we now?
  
  
  
  

                 Week 6



October 1, 2019      Chapter 11: Measuring the Cost of Living


• Chapter 11: Measuring the Cost of Living
  • The Consumer Price Index
  • How is the CPI calculated
    • Fix the basket of goods
    • Find the prices
    • Compute the basket's cost
    • Choose a base year and compute the basket
    • Compute the inflation rate
• Review: How is the CPI calculated
• Quiz 11
• Problems in Measuring the Cost of Living
  • 1. Substitution Bias
  • 2. Introduction of New Goods
  • 3. Unmeasured Quality Change
  • 4. It's an Average
• The GDP deflator versus the CPI
• Correcting Economic Variables for the Effects of Inflation
  • Dollar figures from Different Times
  • Indexation
  • Real and Nominal Interest Rates
• Premium PowerPoint for Ch. 11 Measuring the Cost of Living
  


October 3, 2019      Chapter 12: Production and Growth


• Chapter 12: Production and Growth
  • Economic Growth Around the World
  • Productivity: It's Role and Determinants
    • Why Productivity is so important
      • How Productivity is Determined?
      • Physical Capital per worker
      • Human Capital per worker
      • Natural Resources per worker
      • Technological Knowledge
• Premium PowerPoint for Ch 12: Production and Growth



• Due October 10, before 11:59 pm. Paper #1 Due in Bb Learn: Minimum Wage: Where are we now?
  
  
  
  

                   Week 5
  
  

  September 24, 2019      Chapter 10: Measuring a Nation's Income
  
  
  • Review the Exam - Quiz
  • Chapter 10: Measuring a Nation's Income
    • Income versus Expenditure - two ways to Measure GDP
    • Measurement of GDP
    • The Four Components of GDP
    • Gross Domestic Product news release, 2nd Quarter, 2019 (Third estimate)
  • Premium PowerPoint for Ch 10 Measuring a Nation's Income
  
  September 26, 2019      Ch. 11 Measuring the Cost of Living and finish Chapter 10
  
  
  • Chapter 10: Measuring a Nation's Income
    • The Four Components of GDP
      • Consumption or PCE (Personal Consumption Expenditures)
      • Investment Expenditures
      • Government Expenditures
      • Net Export Expenditures (Exports minus Imports)
    • Real versus Nominal GDP
    • The GDP Deflator
  • Quiz #9: Calculate Real PCE, Investment, and G growth rates and PCE/GDP
  • Premium PowerPoint for Ch 10 Measuring a Nation's Income
    
    

                     Week 4
    
    

  September 17, 2019      Chapter 6: Supply, Demand, and Government Policy continued
  
  
  • Chapter 6: Supply, Demand, and Government Policy
    • Controls on Prices
      • Price ceilings
      • Price floors (minimum wage, for example)
    • ADD Taxes (shift the D or S curve)
  • PowerPoint for Chapter 6: Supply, Demand, and Government Policy
    
    
  • Review for the exam
  
  September 19, 2019      Exam 1, Chapters 1 - 4, and 6
  
  
  
  

                   Week 3
  
  

  September 10, 2019      Chapter 4: The Market Forces of Supply and Demand
  
  
  • Chapter 4: The Market Forces of Supply and Demand
    • What is a Market? A competitive Market?
    • Demand Side
      • The price of the good, movement along the curve
      • Shifts: P-P-P-INT
    • Supply Side
      • The price of the good, movement along the curve
      • Shifts: P-P-EST
    • Equilibrium: Qd=Qs
    • Surplus
    • Shortage
    • 3 Steps to Changes in Equilibrium
    • Note what Ambiguous means
  • PowerPoint for Chapter 4: The Market Forces of Supply and Demand
  
  September 12, 2019      Chapter 4: continued and Chapter 6: Supply, Demand, and Government Policy
  
  
  • Chapter 4: The Market Forces of Supply and Demand
    • Equilibrium: Qd=Qs
    • Surplus
    • Shortage
    • 3 Steps to Changes in Equilibrium
    • Note what Ambiguous means
  • PowerPoint for Chapter 4: The Market Forces of Supply and Demand
    
    
  • Chapter 6: Supply, Demand, and Government Policy
    • Controls on Prices
      • Price ceilings
      • Price floors (minimum wage, for example)
  • Tesla becomes an Electricity Provider
  • PowerPoint for Chapter 6: Supply, Demand, and Government Policy
    
    
  • Quiz #6       Answer to Quiz #6
  
  
  

                   Week 2
  
  

  September 3, 2019      Chapter 3: Interdependence and Gains from Trade
  • Chapter 3: Interdependence and Gains from Trade
    • A Parable for the Modern Economy
      • Production Possibilities
      • Specialization and Trade
    • Comparative Advantage
      • Absolute Advanatage
      • Opportunity Cost and Comparative Advantage
      • Comparative Advantage and Trade
      • The Price of Trade
    • Applications:
      • Serena Williams, Should she mow the lawn?
      • Should we trade with other nations?
  • PowerPoint for Chapter 3: Interdependence and Gains from Trade
  
  Quiz #2: PPF      Quiz #2: PPF Answers
  
  
  September 5, 2019      Chapter 3: Interdependence and Gains from Trade
  • Chapter 3: Interdependence and Gains from Trade
    • A Parable for the Modern Economy
      • Production Possibilities
      • Specialization and Trade
    • Comparative Advantage
      • Absolute Advanatage
      • Opportunity Cost and Comparative Advantage
      • Comparative Advantage and Trade
      • The Price of Trade
    • Applications:
      • Serena Williams, Should she mow the lawn?
      • Should we trade with other nations?
  • PowerPoint for Chapter 3: Interdependence and Gains from Trade
    
    
  • Introduction to Chapter 4:
  • Chapter 4: The Market Forces of Supply and Demand
    • What is a Market? A competitive Market?
    • Demand Side
      • The price of the good, movement along the curve
      • Shifts: P-P-P-INT
  
  
  

                   Week 1
  
  

  August 27, 2019      Chapter 1: Ten Principles of Economics
  • The Syllabus, Outline, and a little about me
  • Chapter 1: What are these 10 Principles of Economics
    • How people make decisions
    • How people interact
    • How the Economy as a Whole Works
  • PowerPoint for Chapter 1: Ten Principles
  
  August 29, 2019      Chapter 2: Thinking Like An Economist
  • Chapter 2: Thinking Like an Economist
    • The Scientific Method and the Role of Assumptions
    • The Circular Flow: The first model of Economics we will study
    • Model 2: The Production Possibilities Frontier (PPF)
    • Positive versus Normative Economics
    • Why Economists Disagree
  • PowerPoint for Chapter 2: Thinking Like An Economist
  
  



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Last Update: November 24, 2019
By Andrew L. H. Parkes, Ph. D.