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Introduction to Economics 201
Reference #16420
Fall 1999
Class meets in Rm 115 Education at 10:00 MWF
Instructor: Eugene Wagner Office: Manheim Hall, #203E Office Hours: MW 11:00-11:50 and by
Appointment
Office Phone: 816-235-2840 Home Phone: 816-235-0889
If you are having difficulty in the course, talk to be me after class, call, or meet in office hours.
Don't wait!! This course outline is not a contract. It is a general schedule of classroom activities.
The instructor reserves the right to modify the materials on this outline including lectures, quiz dates,
and examination dates. Only the final date and time is fixed, but then we might have a major snow fall.
If the schedule gives difficulty because of religious holidays, or other major inconveniences,
please let me know.
Course Purpose and Structure:
Introduction to Economics 201 is the first course in
theoretical economic analysis in the program of study 
of the Department of Economics. It is required for all
majors of economics. A number of other schools and
departments also require that their majors successfully
complete this course. At this university the basic
principles courses are two three hour courses. The
division of the courses is based on an assumed
distinction between "macro" and "micro" economic
conditions.
Today there are differences in views regarding the
merits of continuing to distinguish between
macroeconomic and microeconomic theory in the
college curriculum. The current division
between macro and micro theory came after
World War Two. During the depression of the 1930s
John Maynard Keynes, an English economists, published
his now famous text The General Theory of Employment,
Interest and Money.
At the time of publication investment in most capitalist countries was virtually nil. Unemployment was
extremely high. International trade was negligible. During the years of the Depression most teachers
of the economics held to a "mainstream" economic perspective [that which you now study as
microeconomics] insisting that the self regulating market would in time resolve the matter of
unemployment and low investment. Keynes contended that there was a need for the government to
intervene in the economy as a consumer and employer of last resort if employment and investment were
to be returned to an acceptable level. Government action, he held, would assist the private market
system by encouraging private programs of spending and investment thus hastening a return to higher
levels of economic activity. A number of countries, including the U.S., had in place a number of
employment programs without benefit of the theories of Keynes.
The Keynesian theoretical perspective was not introduced to students in basic courses in economics
until the late 1940s when Paul Samuelson published his text Economics. His text distinguished the
Keynesian model from the classical or neo-classical model. Quickly two courses were introduced into
the college program, macro and micro theory. In recent years a number of texts now seek to again
merge the perspectives of the two courses. In this approach Keynes is assigned a much more modest
role than that introduced by Samuelson. Such is not the case with this course, nor is it the general
perspective of this department.
It is the intent of this course to improve the level of economic literacy of those enrolled and to
"de-mystify" the language and the theories of economics. Specifically the course is designed to give
the student a greater understanding of the domestic economy of the United States and the international
economy in which the U.S. is now a major player. Second, the course introduces the student to the
manner of thinking of economists. We are different!!! Third, the course intends to identify the
political/economic differences in thought and theory of the public, the politicians and the economists.
Fourth, by the end of the semester it is hoped that you will fully comprehend the issue of "division of
labor" discussed in the above paragraphs concerning Keynes and the classical perspective!!
Economics is much the "stuff" of debates and discussions in government, in the offices of businesses
and on the shop floor. As such an understanding of the general economic issues is critical to citizenship
and to the task of earning a living. The macroeconomics component of the six hours of introduction
courses primarily is concerned with the aggregate conditions of the economic system. Included is some
history of the economy, a discussion of the history of thought, (that is the caste of characters who have
written about economics and economies). The general "macro model" traditionally has had four basic
segments. They are the consumer sector, the business sector, the government sector, and the foreign
sector. Attention also is directed to problems of employment, stabilization, and economic growth and
the alternative policies which affect these national goals. This includes a discussion of fiscal and
monetary policies.
It is suggested that you read the entire text from cover to cover as quickly as possible. Then, before
attending class, re-read, a number of times, and take notes on, the materials assigned for the week.
Be able to answer the questions at the end of the chapter and know the solutions to the problems cited
at the end of each chapter. Make a list of questions on text and outside materials . Use the class time
to improve upon your understanding of the subject. You can not learn economics by just attending
lectures. The material is too difficult to be understood only from lecture and discussion. Most learning
is acquired in the quiet of the evening with a book, a lamp and a quiet location. Readings and the
lectures are covered in the exams.
Course Outline:
Text: Karl E. Case and Ray C. Fair, Principles of Macroeconomics 5th Ed
Lectures and Assignments:
Week 1
08/23 Lecture 1 Introduction
08/25 Lecture 2 Studying Economics
08/27 Lecture 3 The Classical Definition of the Science of Economics
Reading: Case/Fair Chaps. 1 & 2
Week 2
08/30 Lecture 4 Markets and Inefficiencies
09/01 Lecture 5 The Structure of Systems in Practice and Theory
09/03 Lecture 6 The Public Sector & International Sector
Reading: Case/Fair Chap. 3
Week 3
09/06 Labor Day
09/08 Lecture 7 Supply and Demand/Demand and Supply
09/10 Lecture 8 The Matter of Elasticity - Quiz 1 Material through Lec. 7.
Reading: Case/Fair Chap. 4
Week 4
09/13 Lecture 9 The Dismal Science and Rationing
09/15 Lecture 10 The Age of Keynes
09/17 Lecture 11 Business Cycles and Competing Concerns
Reading: Case/Fair Chaps. 5 & 6
Week 5
09/20 Lecture 12 The National Income Accounts
09/22 Lecture 13 National Income, the Income Approach and Identifying Changes
09/24 Examination Examination of Material Covered in Readings and Lectures 1 - 13
Reading: Case/Fair Chaps. 7
Week 6
09/27 Lecture 14 The Matter of the Labor Force and Unemployment
09/29 Lecture 15 Inflation
10/01 Lecture 16 Beginning the General Macroeconomic Model
Reading: Case/Fair Chaps. 8 & 9
Week 7
10/04 Lecture 17 The Investment Decision
10/06 Lecture 18 Government and the Economy (Guest Lecture - J. Ward)
10/08 No Class Federal Reserve Visit
Reading: Case/Fair Chap. 10
Week 8
10/11 Lecture 19 The Money Matter
10/13 Lecture 20 Banking, Money Creation and All That
10/15 Lecture 21 Managing the Banking System - Quiz 2 Material from Lec. 14 - 20
Reading: Case/Fair Chap. 11
Week 9
10/18 Lecture 22 Control of the Money Supply
10/20 Lecture 23 Money Demand
10/22 Lecture 24 Speculative Balances
Reading: Case/Fair Chap. 12
Week 10
10/25 Lecture 25 Combining the Goods and Money Markets
10/27 Lecture 26 Conditional Policy
10/29 Examination 2 Examination of Material Covered in Readings and Lectures 14 - 26
Reading: Case/Fair Chap. 13
Week 11
11/01 Lecture 27 Aggregate Demand and Supply
11/03 Lecture 28 Again the Matter of Inflation
11/05 Lecture 29 What Happened to the Phillips Curve
Reading: Case/Fair Chap. 14
Week 12
11/08 Lecture 30 The Matter of Work
11/10 Lecture 31 The Debt and Deficit
11/12 Lecture 32 Issues of Stabilization
Reading: Case/Fair Chaps. 15 & 16
Week 13
11/15 Lecture 33 What of Monetarism and Supply Side Theory
11/17 Lecture 34 Marx on Economic Matters
11/19 Lecture 35 Economic Growth - Quiz 3 Material from Lec. 27 to Lec. 35
Reading: Case/Fair Chaps. 17 and 19 and Chap. 23 "Econ. Theories of Marx"
Week 14
11/22 No Class Visit Commodity Exchange
11/24 No Class Film Requirement
11/26 No Class Thanksgiving
Week 15
11/29 Lecture 37 International Trade
12/01 Lecture 38 The Trade Debate
12/03 Lecture 39 NAFTA
Reading: Case/Fair Chap. 20
Week 16
12/06 Lecture 40 International Competition and Future States
12/08 No Class Study Day
12/10 Final Exam - Note the time of exam 8:00 to 10:00 am
Reading: Case/Fair Chap. 24 Read "Alternative Systems"
Grading:
The assignments for the course are: 1) three quizzes 2) two exams 3) a final exam. Quizzes and exams
are multiple choice. Materials to be covered on the hour exams and on the quizzes are cited on the
outline. Of the three quizzes, the quiz which carries the lowest grade will not be counted in the
evaluation of the final grade.
Letter grades including plus and minus. For the final grade, each of the highest graded quizzes carries
a weight of 12.5%. Each hour examination is weighted 22.5%. The final has a weight of 30%. Grades
are determined as follows. An A+ is assigned the number 4.37, A is 4 . . . C+ is 2.37 . . . D- is .67
and F is 0. In the determination of the final grade the letter/number grades is multiplied by the weight of
the instrument of evaluation. The final number is converted to a letter grade. Grades on the margin of two
grades are adjusted based upon performance on the final exam. The method is similar to the
assignment of the GPA. No A+ is assigned as a final grade for the course.
If you are having problems with a particular chapter see me at the office or call me at the office or at
home. My home phone is 363-0889. Read carefully the list of economic definitions at the back of the
text. Also work some of the text problems. Solutions are given at the back of the text.
Posting of Grades:
We are not permitted to post grades using your Social Security number nor your student number.
When you submit your first quiz I shall return a copy of the quiz with a pin number assigned to you.
I will use this number for the posting of all subsequent grades and the final grade. If you have a problem
with the pin number assigned please see me. The grades for the 2nd and 3rd quizzes will be posted by
pin number on the wall at the back of the classroom. The Final grades will be posted on the same wall
and on the board near 211 Haag Hall about one week after the final exam is given. The grade will be
posted by pin number.
Make up examinations:
Make up examinations for a missed examination will be given on Dec 8 at 10:00 a.m. Meet in
Room 211 Haag Hall. Exams and grading will be exactly the same as that for the regularly scheduled
examinations. You can miss one quiz or exam and take that in the make up session. More than one
quiz or exam missed and we both have problems. You must contact the instructor prior to the day of
the scheduled make up if you intend to take an examination. Write me a note so I can keep track of
circumstances.
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