AB0901

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AB0901 PRINCIPLES OF ECONOMICS: A SINGAPORE PERSPECTIVE

Academic Year : 2013 2014 Semester: 2

Course Coordinator : Siang Ng

Pre-requisites : Nil

No. of AUs : 3 Course Description and Scope This course aims to provide a basic understanding of Economics. The first portion of the course will cover topics in Microeconomics such as the theory of consumption, the theory of production and market structures. The second portion of the course will cover topics in Macroeconomics such as Gross Domestic Product, inflation, Unemployment, Fiscal Policy, Monetary Policy, Nominal and Real Exchange Rate, Purchasing-power Parity Theory and International Flow of Goods and Capital. Course Learning Objectives After the course, students should be able to: Explain the concepts of demand, supply, elasticity, efficiency, GDP, inflation and unemployment Apply economic models to analyze impact on market and economy when shock occurs Calculate revenue, cost and output for firms Compare and contrast different market structures Analyze the effect of government policies on market and economy Discuss an open economys interaction with the rest of the world. Learning & Teaching Methods Lectures : 2 hours per week Tutorials : 1 hour per week Course Assessments

Components Marks Individual/Group

Quizzes 20% Individual

Class Participation 10% Individual

Final Examination 70% Individual

Total 100 Reading and Reference Basic Text: N Gregory Mankiw, Euston Quah, Peter Wilson, Principles of Economics: An Asian Edition, Cengage Learning 2013. (referred to as MQW in the weekly topic reading below)

Other references may be given in lectures.

Distributed by Nanyang Business School, Nanyang Technological University. All Rights Reserved

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Course Teaching Staff

Instructor/tutor Office Location Phone Email

Siang Ng HSS- 04-73 [email protected]

Suman Kamari Sharma [email protected]

Jackson Teh Wah Yock [email protected]

Ou Kun [email protected]

Lyon Loh

[email protected]

Proposed Lecture Schedule Teaching Week Topics Readings MICROECONOMICS: 1 13 Jan 14

Lecture 1: Introduction How people make decisions How people interact How the economy as a whole works The economist as scientist The economist as policy adviser

MQW Chapters 1-3

2 20 Jan 14

Lecture 2: Supply and Demand I: How Markets Work Demand Supply Supply and demand together The elasticity of demand The elasticity of supply The applications of supply, demand and elasticity Control on prices

MQW Chapters 4-6

3 27 Jan 14

Lecture 3: Supply and Demand II: Markets and Welfare Consumer surplus Producer surplus Market efficiency The deadweight loss of taxation The determinants of the deadweight loss

MQW Chapters 7-9

4 3 Feb 14

Lecture 4: Firm Behavior and the Organization of Industry I Production and costs The various measures of cost Costs in the short run and the long run What is a competitive market Profit maximization and competitive firms supply curve The supply curve in a competitive market

MQW Chapters 13-14

5 10 Feb 14

Lecture 5: Firm Behavior and the Organization of Industry II - Monopoly, Oligopoly and Monopolistic Competition Monopoly How monopolies make production and pricing decisions The welfare cost of monopoly

MQW Chapters 15-17


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Teaching Week Topics Readings Public policy toward monopolies Price discrimination Oligopoly Markets with only a few sellers Game theory and the economics of cooperation Public policy toward oligopolies Monopolistic competition Competition with differentiated products Advertising NOTE: The Microeconomics Quiz will be held NEXT WEEK (Week 6). There will be 10 Multiple Choice Questions, covering material from Lectures 1-4. You will take the quiz during the second half of tutorial 5.

6 17 Feb 14

Lecture 6: The Economics of Public Sector Externalities and market inefficiency Private solutions to externalities Public policies toward externalities Public goods Common resources

MQW Chapters 10-11

MACROECONOMICS: 7 24 Feb 14

Lecture 7: GDP, Unemployment, Inflation, and Economic Growth Major macroeconomic issues The measurement of GDP The components of GDP Real vs nominal GDP The consumer price index Correcting economic variables for the effects of inflation Unemployment and natural rate

MQW Chapters 23-24, and 28

3 March 14 to 7 March 14

Recess week

8 10 march 14

Lecture 8: Saving, Investment and Financial System Productivity and growth Financial system Saving and Investment in the national income accounts Market for loanable funds

MQW Chapters 25-26

9 17 march 14

Lecture 9: Money, the Price Level and Inflation The meaning of money The central banking system Banks and the money supply The Classical theory of inflation The costs of inflation

MQW Chapters 29-30


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Teaching Week Topics Readings 10 24 March 14

Lecture 10: Aggregate Demand and Aggregate Supply Three key facts about economic fluctuations Explaining short run economic fluctuations The aggregate demand curve The aggregate supply curve Two causes of economic fluctuations How monetary policy influence aggregate demand How fiscal policy influence aggregate demand Using policy to stabilize the economy

MQW Chapters 33-34

11 31 march 14

Lecture 11: Inflation and Unemployment The Phillips curve Shift in the Phillips curve the role of expectation Shift in the Phillips curve the role of supply shocks The cost of reducing inflation NOTE: The Macroeconomics Quiz will be held NEXT WEEK (Week 12). There will be 10 Multiple Choice Questions, covering material from Lectures 7-10. You will take the quiz during the second half of tutorial 11.

MQW Chapter 35

12 7 April 14

Lecture 12: Open Economy Macroeconomics The international flows of goods and capital The prices for international transactions: real and nominal exchange rates Purchasing power parity Supply and demand for loanable funds and foreign currency exchange How policies and events affect an open economy

MQW Chapters 31-32

13 14 April 14

Lecture 13: Review Lecture


Other references may be given in lectures.Course Teaching StaffProposed Lecture Schedule

Documents

AB0901