WELCOME TO ECON 1110

PRINCIPLES OF MACRO

Dr. Young Se Kim

6:30 – 9:20

SYLLABUS

Instructor: Young Se Kim Office: Etech 220 H Ph.# 565-2220 Office Hrs.: 1:00 – 3:00 TW and

by appointment email: kim1@unt.edu web site: www.cas.unt.edu/~kim1

EXAM DATES

Exam 1 - February 20th Exam 2 - April 3rd Exam 3 - May 1st COMPREHENSIVE FINAL EXAM -

SATURDAY, May 6th at 2:00pm

GRADING POLICY

3 hourly exams (150 pts. each) 450 pts Final Exam (comprehensive) 300 pts Homework Assignments 150 pts Newspaper Assign. and Quizzes 100 pts

TOTAL possible 1000 pts

GRADING SCALE

A = 1000 - 900pts B = 899 - 800pts C = 799 - 700pts D = 699 - 600pts F = 599pts or below

Newspaper Assign. and Quizzes

Short writing assignments based on current economic condition (30 pts)

Detailed instructions will be distributed

8 “unannounced” quizzes (70 pts) Workbook and a number 2 pencil with you No make-up quizzes

TEXTBOOK AND MATERIALS

Roger A. Arnold Macroeconomics UNT 7th edition

Principles of Macroeconomics Workbook 2006 edition

A Non-Programmable Calculator Number 2 Pencils

HOMEWORK Homework assignments will be made on a weekly

basis. Assignments will come from the workbook and

should be turned in on scantrons I will supply the scantrons Your name should appear on all scantrons

Last name, First name An assignment sheet with all homework for the

semester is on the web

TUTORING CENTER

Principles Tutoring Lab – Etech 266 The lab is open from 8:30 – 6:30 Mon. &

Wed., 8:30 – 5:00 Tues&Thurs., and 8:30 – 1:00 on Friday

Practice exams are available at www.econ.unt.edu

Principles of Macro ECON 1110Spring 2006

Chapter 1

What Economics Is About

IMPORTANCE OF ECONOMICS

Good Citizenship in a Democratic Society Improved personal decision making Aids business decision making

MICRO vs. MACRO

MICROECONOMICS - the branch of economics that deals with the behavior and choices of an individual, firm, single industry, or market.

MACROECONOMICS - the branch of economics that deals with the aggregate behavior of the entire economy.

MICRO vs. MACRO (Example)

Macroeconomics does not try to answer the question of

a) why do some countries experience rapid growth

b) what is the rate of return on education

c) why do some countries have high rates of inflation

d) what causes recessions

MICRO vs. MACRO (cont.)

Determinants of inflation Relative market shares of GM and Ford Amount of imports and exports between

U.S. and Japan Growth of total production in U.S. Level of output a firm produces

Important Macro Concepts

Economic Growth Unemployment Inflation Economic fluctuations Productivity Government Spending and

Taxation Monetary Policy

SCARCITY AND CHOICE

Unlimited Wants and Limited Resources Leads to SCARCITY

Scarcity Necessitates Choices ECONOMICS is the study of CHOICES

Definition of Economics

the study of how individuals and society CHOOSE

to employ SCARCE RESOURCES to produce goods and services

and to DISTRIBUTE them among the members of society

4 CATEGORIES OF RESOURCES

LAND - natural resources LABOR - physical and mental talents

people contribute to the production process CAPITAL - improvements to land such as

buildings, machinery and tools ENTREPRENEURSHIP - the talents that

some people for organizing land, labor, and capital into new business opportunities.

THINKING LIKE AN ECONOMIST

Scarcity and its effect - Need for a rationing device: dollar price - Competition Opportunity cost: What one has to give up in foregone alternative when any

action is taking

Ex) What is the opportunity cost to you of attending college? What was your opportunity cost of coming to class today?

Opportunity Cost (Example)

Compact Disc (CD): $10 each Cassette Tape (CT): $5 each- Opportunity cost of one CD?- Opportunity cost of five CDs?- Opportunity cost of one CT?- Opportunity cost of four CTs?

THINKING LIKE AN ECONOMIST

Costs and benefits of decisions Decisions require comparing costs and benefits of alternatives. - Whether to go to college or to work?     - Whether to study or go out on a date?     - Whether to go to class or sleep in?

Decisions at the margin - Marginal changes are small, incremental adjustments to an

existing plan of action - Marginal Benefit (MB) vs. Marginal Cost (MC)

SCIENTIFIC THINKING

The Association-Causation Issue (Fallacy of False Cause)

- Association: if two events are linked or connected in some way

ex) wash your car at 10:00 starts to rain at 10:30

SCIENTIFIC THINKING

Fallacy of Composition: The erroneous view that what is good or true for the

individual is necessarily good or true for the group

ex) tariffs

Ceteris Paribus Assumption: All other things held constant or nothing else changes

ECONOMIC CATEGORIES

According to the type of questions

economists ask

POSITIVE ECONOMICS - the study of “what is” in economic matters.

NORMATIVE ECONOMICS - the study of “what should be” in economic matters.

IDENTIFY THE FOLLOWING STATEMENTS AS POSITIVE OR

NORMATIVE

The Stadium should be packed for Saturday’s UNT-UT Game.

The unemployment rate in Dallas is 5.3%. A country as big as the United States should

have a job for anyone that is willing to work.

IDENTIFY THE FOLLOWING STATEMENTS AS POSITIVE OR

NORMATIVE (cont.)

The federal budget deficit has decreased every year for the last 20 years.

The unemployment rate is too high. The costs of medical care are increasing

faster than the income of American citizens. Lower income tax will generate greater

income tax revenue for the government.

Assignment

Get your Text and Workbook Read Chapters 1 - 3 Assignment 1: pp. 11-12 & 17-18

ANY QUESTIONS?