This module is designed to introduce and build an understanding of economics at the foundation level. The module covers basic but essential elements in microeconomics and macroeconomics. There is no assumption of any prior knowledge of economics or mathematics. Microeconomics includes supply and demand, consumer and producer problems, and the market structure. On the other hand, macroeconomics includes aggregate economy, short-run economics fluctuations, macroeconomic policies and the open economy.
Module Aims
1. To introduce students to the main economic principles, theories and concepts at foundation level.
2. To introduce students to the main conclusions derived from economic analysis and develop students' understanding of economic implications.
3. To enable students to develop analytical skills using simple mathematics techniques and economic diagrams.
Learning Outcomes
By the end of this module a student will be expected to be able to:
1. Define and discuss the main economic principles, theories and concepts at foundation level.
2. Use relevant economic diagrams to support arguments or complement with the analysis.
3. Solve economic questions mathematically and interpret the results.
4. Apply and use the main economic models to explain case studies and real life situations.
Syllabus
Microeconomics
1. Introduction: What Is Economics? First Principles; Economic Models; Using Models.
2. Supply and Demand: Construction of Demand and Supply Curves; Market Equilibrium; Price and Quantity Controls; Elasticity.
3. The Consumer: Preference; Budgets and Optimal Consumption; Indifference Curve; Consumer Surplus; Making Decisions;
4. The Producer: Inputs and Costs; Production Function; Perfect competition and the Supply Curve; Profit Maximisation; Competitive Market Equilibrium in the Short and Long Run.
5. Market Structure: Non-Perfect Competition, Monopoly; Monopoly Profit Maximization; Regulation of Monopoly; Monopolistic Competition; Oligopoly.
6. Externalities: Production, Consumption and Externalities. The Economics of Pollution; Policies towards Pollution.
Macroeconomics
1. Macroeconomics: Circular Flow of Income; National income, Expenditure and Output.
2. Short Run Economic Fluctuations: Income and Expenditure; the Multipliers; Aggregate Supply and Aggregate Demand (AS-AD) Model.
3. Unemployment and Inflation: the Phillips Curve; Unemployment and Business Cycle; Wage and Price Adjustment; Inflation, Disinflation and Deflation.
4. Fiscal Policy: the Budget Balance; Fiscal Policy and the Multiplier; Long-run Implications of Fiscal policy.
5. Monetary Policy: Money and Banking; Determining the Money Supply; The Demand for Money; Money and Interest Rate; Monetary Policy and Aggregate Demand; Money, Output and Prices in the Long-run
6. The Open-Economy Macroeconomics, Capital Flows and Balance of Payments; The role of Exchange Rate; Exchange Rate Policy.
Assessment
An in-class test in week 23, 1hr 15 mins (30%).
A 1,000 word essay (30%). Assignment handed in during week 28.
An in-class test in week 35, 1hr 15 mins (30%).
Participation mark (Moodle quizzes): 10%
A three-hour exam during the Summer Examination period.
Non-assessed coursework
Every student is expected to take a diagnostic test in economics in week 16. This will enable the Module Leader to assess each student's background in economics.
In week 20 every student is also expected to take a mock test in economics. With the guidance from the tutor, students will have an opportunity to clearly understand the marking criteria and assess their own work. This is part of students' self-evaluation mechanism and a way for the tutor to identify if extra support is required.
50% coursework and 50% exam
Pass mark: 40%