Principles of Macroeconomics

ECON 2301 (Synonym 33994)

Fall 2011


Instructor:                               Soon-Yong Choi, Ph.D.

Classes:                                   TTH 6:00pm – 7:20pm, PIN Rm. 504

Office Hours:                          PIN Rm. 413, TTH 5:30-6:00pm

                                                Conferences outside of office hours may be arranged.

E-mail:                           ;

Phone:                                     512-223-9224


Course Description:  Principles of Macroeconomics deals with consumers as a whole, producers as a whole, the effects of government spending and taxation policies and the effects of the monetary policy carried out by the Federal Reserve Bank. Macroeconomics is concerned with unemployment, inflation, and the business cycle.


Course Rationale: This course is meant to give students insight into the dynamics of our national economy. The knowledge gained in the course will make students better informed citizens and allow them to follow the debates over national economic policy reported in the news media. This course is also a foundation course that will prepare students to be successful in upper division finance, marketing, business administration, economics, government, and social work courses.


Course Objectives: Students who complete this course will be able to understand:


  • the meaning of unemployment and inflation data and how that data is collected and computed;
  • the meaning and components of the National Income Accounts, especially GDP;
  • the meaning of the business cycle and its phases;
  • the basic Aggregate Supply, Aggregate Demand model of the macro economy;
  • how fiscal policy operates, its tools, and its advantages and drawbacks;
  • how a fractional reserve banking system works;
  • how monetary policy operates, its tools, and its advantages and drawbacks.


EVALUATION: Student performance will be based upon:


  • ATTENDANCE and CLASS PARTICIPATION: Attendance is expected. Each student starts with 70 points (17.5%); each absence counts 5 points off regardless of reason; points will be adjusted for attendance and class participation at instructor’s discretion.
  • EXAMS: 3 exams, each worth 50 points (total 150 points - 38%). Exams will be for one hour, and have true/false, multiple choice, and short essay questions. One-page note will be allowed. There is no make-up exam unless one’s illness can be documented by a doctor.
  • QUIZZES: 3 quizzes, each quiz worth 20 points (total 60 points - 15%). Quizzes will be for 10 minutes, given at the beginning of a class. Students must come to class on time. There is no make-up quiz and a missed quiz will result in zero point.
  • ASSIGNMENT: 3 papers, worth 40 points each (total 120 points - 30%). Discussion paper assignments are given after three class exercises and games. Instructions for assignment will be given after each exercise. A single space, 2 to 3 page report is to be submitted at the beginning of the following class.

GRADING: Final letter grades will be distributed according to the following schedule:

Letter Grade













INCOMPLETES : Incompletes are discouraged. They will be given only when extraordinary events intervene so as to make completion of the course impossible. If you want an incomplete, these events must be documented. To receive an incomplete the student must have completed the first exam and quizzes with a C or better. The student must also fill out an incomplete form. If the form is not filled out, an incomplete grade will not be given. Incompletes will not be given to students who are behind schedule when the semester nears its end. Nor will incompletes be given to students who need just a few more points to make the next higher letter grade. Plenty of opportunity exists during the semester to accomplish your goals.


Scholastic dishonesty: Acts prohibited by the college for which discipline may be administered include scholastic dishonesty, including but not limited to cheating on an exam or quiz, plagiarizing, and unauthorized collaboration with another in preparing outside work. Academic work submitted by students shall be the result of their thought, research or self-expression. Academic work is defined as, but not limited to tests, quizzes, whether taken electronically or on paper; projects, either individual or group; classroom presentations, and homework.


ACADEMIC FREEDOM: Each student is strongly encouraged to participate in class discussions. In any classroom situation that includes discussion and critical thinking, particularly about economic and political ideas, there are bound to be many differing viewpoints. Students may not only disagree with each other at times, but the students and instructor may also find that they have opposing views on sensitive and volatile topics. It is my hope that these differences will enhance class discussion and create an atmosphere where students and instructor alike will be encouraged to think and learn. Therefore, be assured that your grades will not be adversely affected by any beliefs or ideas expressed in class or in assignments. Rather, we will all respect the views of others when expressed in classroom discussions.


Students with disabilities: Each ACC campus offers support services for students with documented physical or psychological disabilities. Students with disabilities must request reasonable accommodations through the Office for Students with Disabilities on the campus where they expect to take the majority of their classes. Students are encouraged to do these three weeks before the start of the semester.


WITHDRAWALS: This is a STUDENT responsibility. Students are responsible for withdrawing themselves from this course if that is what their personal situation requires. This means that if you have taken no tests or only a few of the tests and the semester ends without you having withdrawn yourself, you will receive an F in the course. The instructor makes no promise either implicit or explicit to withdraw students from the course. However, the instructor does reserve the right to withdraw students if the instructor believes the situation warrants such action. For example, if a student misses more than ten classes, the instructor can unilaterally initiate a student withdrawal. The last day to withdraw from this course without penalty is Thursday, November 17.

Instructional Methodology: This class consists of lectures, class exercises and discussions of text material, instructor’s handouts, and current events. It is essential that the student read the assigned reading material prior to attending class in order to be academically prepared for the quizzes, lectures, and class discussions.

TEXTBOOK: N. Gregory Mankiw, Principles of Macroeconomics, 5th edition, South-Western Cengage Learning. (You may use 4th or 6th edition if available.) Other study materials and recommendations include:

  • Class presentation slides will be uploaded to Blackboard prior to each class. But textbook reading assignments are required for tests and quizzes.
  • The textbook’s accompanying study guide is not required but it may be helpful in summarizing chapters and taking practice questions.
  • Use the online resources provided by the textbook publisher: where you can take practice questions.





August 23 - 25

Ch. 1 Ten principles of economics

Ch. 2 Thinking like an economist; graphs


August 30 – Sep. 1

Comparative advantage exercise

Ch. 3 Interdependence and gains from trade


Sept. 5 - 8

Quiz #1; Ch. 4 Market forces of supply and demand

Ch. 4 Market forces of supply and demand


Sept. 13 - 15

Ch. 7 Efficiency of markets

Ch. 9 International trade


Sept. 20 - 22

Exam 1 (chs. 1-4, 7 & 9)

Ch. 10 Measuring nation's income


Sept. 27 - 29

Ch. 10 Measuring nation's income

Ch. 11 Cost of living


Oct. 4 - 6

Quiz #2; Ch. 11 Cost of living

Ch. 12 Production and growth


Oct. 11 - 13

Ch. 13 Savings, investment & financial system

Unemployment compensation game


Oct. 18 - 20

Ch. 15 Unemployment

Ch. 16 Monetary system


Oct. 25 - 27

Ch. 16 Monetary system

Exam 2 (chs. 10-13 & 15, 16)


Nov. 1 - 3

Ch. 17 Money growth and Inflation

Ch. 17 Money growth and Inflation


Nov. 8 - 10

Ch. 18 Open economy

Ch. 20 Aggregate demand and aggregate supply


Nov. 15 - 17

Quiz #3; Ch. 20 Aggregate demand and aggregate supply

Ch. 20 Aggregate demand and aggregate supply


Nov. 22

Ch. 21 Monetary and fiscal policies



Nov. 29 – Dec. 1

Ch. 21 Monetary and fiscal policies

Fiscal & monetary policy exercise


Dec. 6 - 8

Ch. 22 Inflation and unemployment

 Exam 3 (chs. 17-18, 20 & 21)