Faculty of Business and Management Sciences · Islamic Economics and Finance · Undergraduate
Course Objective
This course is designed to give students the ability to evaluate intermediate macroeconomic concepts and make students ready to use logic and methods of macroeconomic analysis in their further studies. It will provide an overview of the concepts of macroeconomic issues such as the determination of output, employment, unemployment, interest rates, and inflation. The course examines the main principles of real income determination, the concepts of goods and financial markets, as well as monetary and fiscal policies.
Course Content
This course starts looking at the world economy and describing the national income accounts. Then the basic concepts of general equilibrium in the economy with goods and financial markets are handled. Later, the closed economy version of the Keynesian macroeconomics is considered under the assumptions of fixed price (IS/LM analysis) and variable price (AD/AS analysis). Then, the labor market and the Phillips Curve are studied. Finally, some important macroeconomic variables such as inflation, unemployment, monetary policy, cyclical fluctuations theories, consumption and investment are discussed in more detail.
Course Learning Outcomes
- • be able to define the main macroeconomic concepts like GDP, inflation, unemployment, balance of payments, monetary, fiscal, redistribution and exchange rate policy
- • be able to explain the basic mechanism of macroeconomics.
- • be able to evaluate the relationship between macroeconomic variables.
- • be able to describe the models and methods used in macroeconomic analysis
- • able to use the IS-LM, AD-AS and IS-LM-BP models to analyse macroeconomic problems
Core Area Distribution
Teaching Methods
Assessment & Evaluation
ECTS / Workload
| Activity | Quantity | Duration (h) | Total Workload |
|---|---|---|---|
| Course Duration (Including Exam Week) | 15 | 3 | 45 |
| Out of Class Study Period | 15 | 3 | 45 |
| Midterm | 1 | 1 | 1 |
| Quiz | 1 | 1 | 1 |
| Assignment | 0 | 0 | 0 |
| Practice | 0 | 0 | 0 |
| Final | 1 | 1 | 1 |
Course Schedule
| Week | Subject | Preparation |
|---|---|---|
| 1 | Introduction to course | Clark, Gregory; A Farewell to Alms: A Brief Economic History of the World, Princeton, 2007. |
| 2 | Chapter 1 A Tour of the World | Woodford, Michael; “Revolution and Evolution in Twentieth-Century Macroeconomics” 1999. |
| 3 | Chapter 2 A Tour of the Book & Assignment 1 | Blanchard, O. (2009). The State of Macro. Annual Review of Economics, 1, 209–228. |
| 4 | Chapter 3 The Goods Market & Assignment 2 | Mankiw, N. Gregory. "Imperfect competition and the Keynesian cross." Economics Letters 26.1 (1988). |
| 5 | Quiz 1 | Chapters (1, 2, and 3) |
| 6 | Chapter 4 Financial Markets & Assignment 3 | Romer, David (2000). Keynesian macroeconomics without the LM curve. Journal of Economic Perspectives 14(2). |
| 7 | Chapter 5 Goods and Financial Markets: The IS–LM Model | Friedman, Milton “The Role of Monetary Policy” American Economic Review, 1968. |
| 8 | Midterm Exam | Chapters (1, 2, 3, 4, 5 and 6) |
| 9 | Chapter 6 Financial Markets II: The Extended IS-LM Model | Chapter 6 |
| 10 | Chapter 7 The Labour Market & Assignment 4 | Ball, Laurence and N.G. Mankiw ‘The NAIRU in theory and practice’, Journal of Economic Perspectives 16(4) 2002, pp.115–36. |
| 11 | Chapter 8 The Phillips Curve, the Natural Rate of Unemployment, and Inflation & Assignment 5 | James H. Stock & Mark W. Watson, 2008. "Phillips curve inflation forecasts," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 53. |
| 12 | Quiz 2 | Chapters (6, 7, and 8) |
| 13 | Chapter 9 From the Short to the Medium Run: The IS-LM-PC Model & Assignment 6 | Laubach, Thomas, and Williams, John C. "Measuring the Natural Rate of Interest" The Review of Economics and Statistics, 2003. |
| 14 | Chapter 10 The Facts of Growth | Robert M. Solow. A Contribution to the Theory of Economic Growth. The Quarterly Journal of Economics, Vol. 70, No. 1. (Feb., 1956), pp. 65-9 |
| 15 | Revision | All Chapters |
| 16 | Final Exam | All Chapters |