Mr. Mutti	Carnegie 204
Econ 111.03	Office Hours:
Spring 2006	11:00 a.m. – 12:00 a.m. MWF
	2:00 p.m. – 3:00 p.m. TTH

Introduction to Economics

Course Overview

This course provides an introduction to economic concepts, analytical tools and policy analysis.  Because economic events are a source of constant public debate, a major goal of this course is that we learn what elements of a controversy might be evaluated as a matter of economic fact and what issues remain a question of individual value judgment over how a society ought to function.  (Note that our choice of which controversies to consider involves a value judgment.)

The course covers two broad areas of economic inquiry:  microeconomics (dealing with individual consumers, firms, industries or products) and macroeconomics (dealing with aggregates that show the "big picture," such as national income, unemployment, inflation and interest rates). 

We begin by considering microeconomic issues and how a market functions.  We evaluate what factors determine the demand for or supply of a good and predict the response to changes in these factors over time.  We apply these insights to consider the consequences of government intervention, especially where we believe a failure in the market system has occurred. 

In the second half of the course, we deal with macroeconomic issues.  We begin by considering how aggregate output and prices for the economy as a whole are measured.  We then assess what causes aggregate output and prices to change in the long run, paying special attention to investment, and saving.  We address those same questions in the short run, when the economy may not be at full employment, and also consider the way government’s fiscal and monetary policy may influence the performance of the economy as it moves from the short run to the long run.

Examinations

There will be 3 hour exams during the semester (each count 20 percent of your grade) and a cumulative final exam (25 percent).  Homework assignments, short essays, and class participation account for the remainder of your grade (15 percent). 

Textbook

Krugman and Wells, Economics, Worth, 2006.

I expect you to keep abreast of current economic events during the semester and encourage you to read a newspaper such as the New York Times, the Wall Street Journal, or the Financial Times (student subscriptions available).

Course Outline                                                                                                                                                             

A.	Basic Economic Issues and Approaches	KW  1, 2
B.	Analysis of a Market:  Supply, Demand, Elasticity and the Gains to Consumers and Producers	KW  3, 4, 5, 6
	Exam #1, approximately February 15th
C.	Cost Conditions, Prices and Output in Competitive Markets	KW  8, 9
D.	Prices and Output under Monopoly	KW  15
E.	Other Market Failures: Externalities and Public Goods	KW  19, 20
	Exam #2, approximately March 8th
F.	Measurement of Aggregate Output and Prices	KW  23, 24
G.	Long-Run Economic Growth, and the Financial System	KW  25, 26
H.	Short-run Economic Performance: AS, AD, and Fiscal Policy	KW  27, 29
	Exam #3, approximately April 19th
I.	The Money Supply and Monetary Policy	KW  30, 31
J.	Unemployment and Inflation	KW 32, 33
	Final Exam, Tuesday, May 16th (9:00 a.m.)