The purpose of this course is to enhance students’ understanding of macroeconomic issues and problems. The course will help students to analyse question such as, what is economic growth and how to achieve it. Why is there unemployment, why are there short- run fluctuations in the economy, what causes inflation and business cycles. Upon completion of this course, students will be in a position to analysis issues of policy relevance and relate specific issues to theory.This course is concerned with the contemporary issues in the macroeconomic theories that can explain the determinates and measurements of the levels and changes in aggregate variable such as GNP, unemployment, the general price level, interest rates, growth rates, and the exchange rate. Topics covered include: the measurement of gross domestic product, theories of aggregate demand and aggregate supply, theoretical and practical aspects of monetary and fiscal policies, economic stabilization policy.
Macroeconomic concerns – Data of Macroeconomics – Macroeconomic aggregates-Classical dichotomy – Keynesian income determination model – Money illusion, wage price rigidity – IS – LM framework – stability of equilibrium, Monetary and Fiscal policy effectiveness – Labour market and unemployment – Aggregate demand, aggregate supply and price level – Theories of consumption and investment – Money and inflation: Demand for and supply of money, Philips curve, social costs of inflation and hyperinflation – Introduction to open economy concepts – Macroeconomic policy debates, stabilization policies and government debt
Introduction: Measurement of Macroeconomic Variables – Aggregate Demand and Aggregate Supply – The Income-Expenditure Model – The Fixed-Price AD-AS Model – The Output Multiplier – The Monetarist Counterrevolution – Output, Inflation and Unemployment
Alternate Views: Real Business Cycles and New Keynesian Economics – Exchange Rates and the International Monetary System- Monetary and Fiscal Policy in the Open Economy – The Money Supply and the