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Inflation, Unemployment, and Public Policy

Rutgers University
The State University of New Jersey
Department of Economics – CCAS
Spring 2013

Class Information

Course Title: Inflation, Unemployment, and Public Policy (index#57294), Economics 320/Section 01
Instructor: Dr. I-Ming Chiu
Office: ARMITAGE 328
Phone: (856) 225 6012
E-mail address: ichiu@camden.rutgers.edu
Class Meeting: BSB 334.  9:30-10:50 AM (Tuesday/Thursday)
Office Hours: 11:30-1:30 PM, Tuesday or by appointment

Course Description:

Inflation and Unemployment are two common recurring problems in all the economies. This course will study the causes, relations, and consequences of inflation and unemployment with the introduction on different macroeconomic thoughts. Students will learn how public policies, such as fiscal and monetary policy, can be purposefully employed to reduce the severity of these two economic problems. In addition, students will study how to conduct simple data analysis to explore the relationships between key macroeconomic variables.


  • Peter Kennedy, Macroeconomic Essentials, 3rd Edition, The MIT Press, 2010.

Class Material:

Handouts, readings, and assignments will be posted on Sakai website for you to download.

Useful Websites:

Academic Calendar:

Grading:Contribution to Final Grade
Attendance 5%
Take-home problems 25%
Midterm (2) 50%
Final Exam (comprehensive) 20%
Participation (extra credit) 5%

Grading Policy:

Term grades will be based on the final distribution of the above grading weights.

Exam Preparation:

The exams will include short analytical questions only. The material for these questions will be drawn from three sources: (i) homework assignments, (ii) course lectures, and (iii) reading material.

Class Participation:

Class attendance is essential for learning achievement. When missing a class, it would cost you more time to learn on your own. I strongly recommend the following steps for your successful learning: (1) attend every class and take notes; (2) review everything you learn from the class immediately, never put it off; (3) ask questions and participate in class discussions.

Academic conduct:

Make up exams will be given only upon prior notice. I request prior knowledge of any expected absence from an exam. If this is not feasible, you can document a valid reason for missing the exam. Unexcused absence on any exam will result in a grade of zero. Dishonesty in seeking an excused absence or in the examination process will result in a grade of zero on the exam involved and in university discipline.

Course Outline:

Chapter 1


Chapter 2

The Basics of Supply and Demand, and a Big Picture

Chapter 3

Measuring GDP and Inflation

Chapter 4


Chapter 5

The Role of Aggregate Demand

Exam I

Date: TBA in the class

Chapter 6

The Supply Side

Chapter 7

Growth and Productivity

Chapter 8

The Money Supply

Chapter 9

The Monetarist Rule

Chapter 10

Monetary Policy and Interest Rates

Exam II

Date: TBA in the class

Chapter 11

Real versus Nominal Interest Rates

Chapter 12


Chapter 13

The Balance of Payments

Chapter 14

Policy in an Open Economy

Chapter 15

Purchasing Power Parity

Final Exam

9:00 – 12:00 AM, Tuesday, May 14.