First Week PowerPoint Slides

Principles of Macroeconomics (with Xtra!)

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ECMB06: Course Overview Text: Macroeconomics: Canadian Edition (3 rd edition) By Mankiw & Scarth Strengths: Well written, not too technical, math is not too hard, short manageable chapters, good ordering of material (LR and very LR dealt with before models of SR) Weakness: Originally a US book there is no Canadian Edition Solutions Manual, text questions can be quite difficult
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ECMB06: Course Overview Workbook: Optional but very useful if having difficulty getting up to speed on a topic Old ones on reserve in Bladen Library Call # HB172.5.M3362 Recommended problems: Four groups or sources (workbook, tutorial, old exams, text) See course Webpage at:
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ECMB06: Grading Scheme Evaluation: - Two Assignments 20% - Midterm Exam 30% - Final Exam 50% Group Assignments (max group size 4) ALL students who miss the Midterm will have the entire weight transferred to the final exam The Final Exam covers the material from the entire course (i.e. is cumulative) Final exam grade replaces midterm grade if score on final improves (i.e. goes up)
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ECMB06: Time Frames Three key time frames: Short-Run (SR): about 3 to 6 months (later) Long-Run (LR): about 4 or 5 years (later) Very Long-Run: after about 10 or more years (have passed) Short-Run: The SR is a short enough period of time such that prices are fixed. The technology is also fixed as is the (productive) capital stock. Variations in employment (L) lead to changes in output (Y).
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ECMB06: Time Frames Long-Run: The LR is a long enough period of time that all prices are perfectly flexible. At the same time it is a short enough period of time that the productive technology and capital stock continue to be fixed. Very Long-Run: The very long-run is such a long period of time that not only are all prices are perfectly flexible but all inputs (K & L) and the productive technology can vary as well. Variations in inputs (K & L) and technology lead to changes in output (Y).
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ECMB06: Course Plan Closed Economy Open Economy Both Short-Run Ch 10, 11 12 9 Long-Run 3, 11 5 (end of 12) 4, 6 & 9 Very Long-Run 7, 8 n/a n/a
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ECMB06: Measurement Issues Chapter 2 deals with Measurement Issues . How do you measure aggregate output (real or nominal), the average price level and the rate of inflation? These issues overlap all of the (modelling) chapters to follow. When dealing with practise questions think of what chapter material (or model) applies and what is exogenous (fixed or given) and endogenous (variable or to be determined/solved for).
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ECMB06: Outline Week 1 Outline (Week #1) 1. Macroeconomics: Why take it? What is it? 2. Measuring Output/GDP - Value Added Approach - Income Approach - Expenditure Approach 3. Key Issues in National Income Accounts (NIA) 4. Measuring the Aggregate (or Average) Price Level & the Rate of Inflation (Real versus Nominal variables)
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ECMB06: Macro What is it?/Why take it?
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  • Inflation, gross domestic product, Value added, National accounts, Consumer price index, market prices

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