Middle East Technical University Faculty of Economics and Administrative Sciences Department of Economics Spring 2011-2012

Econ 210 Principles of Economics

Section 3: Osman Glseven Office: A05 Phone: 3043 E-mail: gulseven@metu.edu.tr Office Hours: TBA Lecture Hours: Friday 14:40 17:30 (Section 3), MM125 Course Assistants: Ferda Kaya AZ 01 2032 Course Webpage: http://online.metu.edu.tr Duygu Deveci A10 7019 fkaya@metu.edu.tr deduygu@metu.edu.tr

Course Description
This introductory course is designed to provide students with an understanding of how economies function. The goal of this course is to furnish students with the basic tools and concepts for analyzing economic events and evaluating policies. There are two parts of the course: macroeconomics and microeconomics. The first part, macroeconomics, looks at the economy as a whole. Understanding the basic macroeconomic concepts such as determination of aggregate income, open economies, the role of government, operation of the monetary system, will be the goal of this part. The second part, microeconomics, is about the consumers' and individual firms' decisions, how they determine the market price, how they interact.

Readings
Course material, will mainly be the lecture notes and you will be responsible from the material lectured in the classroom. While preparing the class notes we will make use of the following supplementary textbooks:

Case, E. Karl, Fair, C. Ray and Oster, M. Sharon, Principles of Economics

Grading Information
The course grades will be based on a midterm (50%, macroeconomics), a final exam (50%, noncumulative, microeconomics). Midterm, and final exam sets will be multiple choices. Note that each section has a different instructor. Therefore, the exams will be different. In fact, we will start with the macroeconomics part, whereas other sections will start with microeconomics. All students are required to take the exams at the places designated according to the sections. Please make sure that you know the section that you registered and mention it correctly in the exams and problem sets. The places will be announced before the examinations on the web-page of the course. Following the midterm exam, the grades will be posted on the website. Exam attendance is required, so make-ups will be given only in cases of officially documented emergencies and only with advance notice and arrangement.

Course Policy

Collaboration during midterms and the final exam is strictly prohibited. If you are caught cheating in the exam, no excuse will be accepted and you will receive an FF from the course. In addition to the Teaching Assistants in your departments, a Teaching Assistant from the Department of Economics as well as your instructor will monitor the exams. Students are responsible for all material covered in lectures. Since many of the questions on the exams will come from the lecture material, attendance to the lectures is strongly recommended but not compulsory. Previous experience suggests that students who attended the classes regularly got better grades. Students are responsible for the announcements made in class and posted on the course webpage. Cancellation of classes and other important info will be posted in METU online; you might also receive an email from your instructors or TAs so check your emails regularly. Please do not ask for an increase in grade, we are not allowed to increase your grade subjectively in any case! (Note that we didnt change any grades after the course grades are announced on subjective grounds last semester and we will not answer the emails asking for an increase this term.) Your grade is determined by your class performance. If you might be in repeat status or might not be able to graduate because of your grade in this course, we strongly recommend you to study the course accordingly, attend the classes regularly AND seek help from your professors and teaching assistants in advance by going to their office hours. We strongly urge you to seek help from us for any type of questions and/or problems about the course during the term NOT when the course grades are to be announced. Exams will be graded by optical reader. If you have any concern and want to see your exam paper please meet with your TAs at the announced date.

Course Outline TENTATIVE COURSE SCHEDULE The lectures in the course will be related to chapters in the book in the following order: Week 0 Introduction / Syllabus Scope and Method of Economics (Chapter 1)

Week 1 Introduction to Macroeconomics (Chapter 20) Measuring National Output and Income (Chapter 21)

Week 2 Unemployment, Inflation, and Long-Run Growth (Chapter 22)

Week 3 Aggregate Expenditure and Equilibrium Output (Chapter 23)

Week 4 The Government and Fiscal Policy (Chapter 24)

Week 5 The Money Supply and the Federal Reserve System (Chapter 25)

Week 6 Money Demand and Equilibrium Interest Rate (Chapter 26)

Mid-Term Exam: Macroeconomics Week 7

The Economics Problem: Scarcity and Choice (Chapter 2) Demand, Supply, and Market Equilibrium (Chapter 3)

Week 8

Demand and Supply Applications (Chapter 4)

Week 9
3

Elasticity (Chapter 5)

Week 10

Household Behaviour and Consumer Choice (Chapter 6)

Week 11

The Production Process: The Behaviour of Profit-Maximizing Firms (Chapter 7)

Week 12 Short-Run Costs and Output Decisions (Chapter 8) Long-Run Costs and Output Decisions (Chapter 9)

Final Exam: Microeconomics

Midterm Exam: April 16, 17:40- 19:00 (Monday) Final Exam: May 31, 16:30 (Thursday)