Trinity College, Department of Economics

  • Economics 101; Prof.: M.D. Ramirez
  • Introductory Economics, Spring 2008
  • Text: Campbell R. McConnell and Stanley L. Brue, Economics, Seventeenth edition (New York: McGraw-Hill Book Company, 2008).

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  • Course Objectives and Organization
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    This course is designed to provide students with the basic set of tools necessary for the analysis of economic and business problems. Although the techniques and concepts developed are simple, they are by no means simplistic, for they go far in helping us understand the major organizational problems and issues facing our economic system. For instance, they provide answers to some of the following questions: How does the price system allocate resources in a mixed economy? Why is the decision whether to consume today or tomorrow so important to society? What is meant by the volatility of investment and why is it important to society? Is there a long run trade-off between unemployment and inflation? Does a weak dollar contribute to inflation and economic instability? Is there a productivity surge in the U.S.? And if so, how has it manifested itself? Is free trade an unmitigated blessing for our economy? Can nations pursue an independent monetary policy in the presence of flexible exchange rates and free capital mobility? Do tax cuts stimulate growth or do they contribute to rising deficits? and so forth.

    The course is divided into five sections outlined in the schedule below. The first section introduces the student to the inevitable fact of scarcity via the production-possibility frontier, as well as, the bare elements of supply and demand. Section II examines the decisions of consumers and businesses under various constraints, market structures, and forms of organization. In addition, it examines the various constraints faced by business firms whenever they engage in production. These include their resource costs, the methods available for producing the good or service in question, and the price which the latter is expected to command in the market. Section III focuses its attention on the "big picture" of the economy by first exposing students to the fundamental concepts of aggregate demand and supply. It then discusses the measurement of output, its determination, and the operation of fiscal policy to insure full employment and price stability. Section IV leads students through a detailed description of how banks and the Fed work together to determine the money supply and interest rates. Finally, Section V introduces the student to the concepts of absolute and comparative advantage, as well as the rudimentary workings of foreign exchange markets.

  • Course Requirements
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    During the spring term two major exams will be given: a mid-term and a final examination. Also, short in-class quizzes will be given on a weekly basis. The exams will be a combination of multiple choice, short answer, and analytical problems. Exams and quizzes will cover the assigned text, lectures, and any readings or handouts given in class. Finally, you will be required to write at most two short critical essays (3-5 pages) on specific readings assigned in class. Students will also be encouraged to make use of an interactive software specifically designed for the seventeenth edition. The objective of these computer assignments is to reinforce the concepts and material presented in class.

  • Course Grades
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    The tentative weights and dates of the components of your final grade are as follows:

                                           Weight (%)                                         Dates

    Mid-term Exam                     30                                            Mar. 12 (W)

    Final Exam:                           35                                                 TBA

    In-class quizzes:                    15                                          Given weekly

    Homework:                          15

    Attendance and participation  5

  • Office Hours
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    My office is located in Williams Building, Room 312, and I will be available for consultation on T and Th between 10:15-11:50, and by appt. My office phone number is 297-2487. I will only accept telephone messages on my message center for extremely urgent reasons such as missing an exam or not turning in a quiz by the assigned date. E-mail messages are welcome as long as they pertain to substantive topics related to class material.

  • Schedule
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    I. Basic Concepts (approx. 4 weeks)

  • Required Reading: McConnell, Economics, Chps. 1-3, 18 and 19.
  • Suggested Reading: Stephen Brown, "California's Electricity Woes: A Vision of the Future?" Fed. Reserve Bank of Dallas, Southwest Economy, Issue 3, May/June 2001, pp. 1-6.
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    .II. Microeconomics (3 weeks)

  • Required Reading: McConnell, Economics, Chps. 19-23, and 25.
  • No classes on  Friday February 29th (Trinity Days).
  • Suggested Reading: Orrenius, Pia, "The Second Great Migration: Economic and Policy Implications," Fed. Reserve Band of Dallas, Southwest Economy, Issue 3, May June 2000, pp. 1-8.
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    III. Macroeconomics ( 3 weeks)

  • Required Reading: McConnell, Economics, Chps. 6, 8-11, 15 and 17.
  • Mid-Term on March 12th (W).
  • Suggested Readings: Schreft, Stacey L., "Jobless Recoveries and the Wait-and-See Hypothesis," Economic Review, Fourth Quarter 2005, pp.81-99 Keynes, John M., The General Theory of Employment, Interest and Money, Chps 2-3, 8-10, and 11- 12; Jonathan L.Willis and Julie Wroblewski, "What Happened to the Gains from Strong Productivity Growth?" Economic Review, 1st Quarter, Vol. 92, No. 1, pp. 5-24.
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    IV. Money, Interest Rates, and Monetary Policy (2 weeks)

  • Required Reading: McConnell, Economics, Chps. 12-14.
  • Spring Break begins March 14th (F).
  • Classes resume on Monday March 24th (M) .
  • Suggested Readings: George Kahn, "The Role of Money in Monetary Policy: Why do the Fed and ECB See it So Differently?" Economic Review, 3rd Quarter 2007, Vol. 92, No. 3, pp. 5-36.
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    V. International Finance (1 week)

    Required Reading: Chp 36.

  • Classes end on Monday April 30th (W).
  • Suggested Readings: Dollar, D. and A. Kraay, "Spreading the Wealth," Foreign Affairs, January/February 2002, pp. 120-133; Scott, Bruce R., "The Great Divide in the Global Village," Foreign Affairs, Vol. 80, No. 1, January/February 2001, pp.160-177.
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