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Principles of Macroeconomics

Macroeconomics Principles: (Subject:220 Course:103)
Rutgers University, the State University of New Jersey
Department of Economics

Professor Tetsuji Yamada
Department Office: ATG 4th floor, Department of Economics, Tel: 856-225-6136
Class: Tuesday and Thursday (3:00pm-4:20pm); Room ATG212
Office: Room Armitage Hall (ATG) #330, Tel: 856-225-6025
Office Hours: (Tu & Th) 11:00am-1:00pm & 4:20pm-5:00pm or by Appointment

Goal #1:
The development of critical thinking skills:
Students taking Principle of Macroeconomics 103 will learn the methodology used in macroeconomics. At the outset of this course, students will study the differences between deductive and inductive reasoning; the formation of positive and normative statements; the expression of cause and effect relationships using words, graphs and equations; the meaning and use of the ceteris paribus assumption, and the formation and testing of a hypothesis. The student will learn the scientific method by considering economic problems and issues. In general, students will be able to analyze that part of the social system to which macroeconomics applies, using critical thinking. The student will be able to organize and evaluate evidence derived from economic analysis, and answer questions about the evidence.

Goal #2:
The accumulation of factual knowledge:
Students taking Principle of Macroeconomics 103 will demonstrate knowledge and understanding of all important concepts in macroeconomics. Students taking introductory macroeconomics will learn about the nature, method and scope of economic analysis; the nature of economic growth; what causes tendencies toward unemployment and inflation; the relevance of monetary and fiscal policies; and the importance of international trade and finance on national economic performance. Students, using analytical skills developed in this class, will understand the implications of national economic policy proposals. They will learn that macroeconomics often poses dilemmas for governments and for the public to solve. In short, students will have acquired factual knowledge about the processes of macro-economy, including the conceptual foundations of economic knowledge necessary for critical interpretation of those processes.

Goal #3:
Application of critical thinking to factual knowledge, and development of reflective decision making skills:
Students will use logical and critical thinking to chain together assumptions, a given factual situation and a conclusion from that situation. To accomplish this result, short-answer and essay tests will be employed, on all or part of the exams for Principle of Macroeconomics 103. Students will acquire a basis for reflective decision-making skills. The objective of this course is for the student to learn about macroeconomics. In addition, students learn how to analyze economic problems, how to synthesize economic concepts, how to think critically, and how to determine cause and effect. The goal of the course is for students to understand the scientific method in considering economic problems and issues, how the scientific method evolved in macroeconomics and how to use scientific methods in macroeconomics.

Goal #4:
Understanding historical facts, cultural context and aesthetic meaning:
Students will be able to outline the basic historical facts about the development of macroeconomics as a coherent body of thought, including the role of major social and natural factors and events influencing its development. Through this historical inquiry, students will be aware of the role of both common (capital) and differing (social) cultural traditions in shaping economic ideas and society based on those ideas. The student will be able to articulate the aesthetic ways in which macroeconomics is uniquely valuable to the development and understanding of modern civilization, in its role of defining relationships between individuals, between individuals and society, and between society and the natural world.

Objectives of this course:
Upon completion of the course, each student will:
1. Understand the economy of the United States – its structure, strengths, and weaknesses. 2. Analyze inflation, unemployment, recessions, booms, and national output. 3. Identify level of income, and US government economic policies. 4. Understand U.S. government fiscal policy and the Keynesian model. 5. Understand U.S. government monetary policy and the Federal Reserve System. 6. Describe the international operation of the U.S. economy. 7. Recognize, discuss, and comprehend macroeconomic issues. 8. Analyze economic environments in the U.S. 9. Discuss and understand macroeconomic problems. 10. Develop economic ways of thinking and understand economic issues. 11. As its primary goal, the course is intended to provide students with a thorough foundation in general economics.

Textbook: Robert Hall and Marc Lieberman, Macroeconomics: Principles & Applications, 5th Edition, 2010, South-Western, Mason, OH, USA


1. Economic Choices, Market System, and Circular Flow


2. Demand, Supply, and Market


3. Production, Income, Employment, and Inflation


4. Long-run Macroeconomics and Economic Growth


5. Economic Fluctuations and Fiscal Policy


6. Money Market and Monetary Policy


7. Aggregate Demand and Aggregate Supply


8. Inflation and Monetary Policy


9. International trade, Exchange Rates, and Monetary Policy



Course Requirement:
1. There will be regular/pop-up quizzes during the semester. You will be assigned homework occasionally. Do not skip the classes in order not to miss the quizzes and homework because there is no makeup quizzes and homework. Timely completion of the assignments is a formal requirement of the course. The assignments are intended to help students reinforce concepts and applications developed in class. Students are strongly encouraged to put forth maximum effort on each homework assignment and quiz.

2. Three examinations will be given including the final examination during the semester. Two mid-term examinations will be announced approximately one week in advance. The final examination will be held during the final exam period. Make-ups will not be given unless the instructor is consulted in advance with a legitimate and documented excuse and permission is not given unless extraordinary circumstances arise (as judged by the instructor).

3. I expect you to attend class regularly and to contribute your experiences and knowledge to class discussions based on what you are leaning. It has been my experiences that students who miss classes generally have great difficulty learning the material. Class participation is factored into the final grade and it will also be considered in borderline cases.

4. Timely completion of all assignments. I accept your assignments by hand. Don’t submit your assignments by e-mail.

Grading: Undergraduate students
30% = Final examination; 20%x2 = Two mid-term examinations;
Quizzes & homework = 20%; and One research paper = 10%.

Grade Scale: A = 93~100% B+ = 88~92% B = 82-87%
C+ = 78~81%; C = 70~77% D = 60~69 F <60%

Notes to Students:

  1. To obtain the maximum benefit from the course you should do the assigned readings prior to the class and attend the lectures.
  2. Specific questions and dates for quizzes and homework will be given in conjunction with the topics.
  3. Academic honesty shall be maintained in accordance with University policy.