ECON1002

COURSE OUTLINE

COURSE DESCRIPTION

Macroeconomics addresses issues affecting the economy as a whole, such as inflation, unemployment, recession and competitiveness.   All agents in the economy need to be concerned about the state of the economy as a whole, as well as the markets in which they buy or sell their goods and services.   Firms are concerned about how inflation, recession, and foreign competition affect their profits, and perhaps even their survival. Governments worry about how to prevent recessions, reduce inflation, increase competitiveness, and increase employment.  Adults are anxious to avoid unemployment that comes with recessions and to obtain rising real incomes.   Pensioners are keen to protect themselves against the hazards of inflation, which can lower the value of their savings.

Each of the concerns just mentioned plays a major role in macroeconomics.    In this course, we look in some detail at how the activity of the economy as a whole is measured before discussing these measures.     We will also look at how national income is determined, and what government can do to influence it. The course emphasises contemporary  resource-use  issues  and  the  development  of  the  skills  of  economic specialists and non-specialists.

Economics is a living discipline and to appreciate the applications of the concepts, you are encouraged to follow events and developments in Caribbean countries and other economies around the world, and relate them to the theories and concepts in the course. This will provide you with a better understanding and appreciation of the basis for economic policy and decision making.

COURSE OBJECTIVES:

It is expected that at the end of the course you will be able to:

•    Evaluate and critique the methodology of macroeconomic analysis and apply this methodology to economic policy analysis.

•    Explain and discuss the nature of demand and supply and their interaction as they relate to the workings of a market system.

•    Describe and explain the concept of elasticity and show how it is applied at the level of the government with respect to the setting of prices for various types of goods and services.

•    Define,  discuss  and  compute  the  statistics  economists  use  to  monitor  the macroeconomy.

•    Discuss the long-run determinants of the level and growth of real gross domestic product (GDP).

•    Examine the functions and characteristics of money, banking, tools of monetary policy and discuss how the growth of the money supply is related to inflation.

•    Describe   the   model   economists  use   to   analyse   the   economy’s  short-run fluctuations and analyse the actions policymakers might undertake to offset recessions.