AP Macroeconomics Syllabus

Mr. Snyder

Welcome!

Seeing each of you in class today brings me great personal and professional satisfaction. Byenrolling in AP Macroeconomics you have made a wise choice for your educational future. Youand your peers will encounter an economic playing field unlike any other. This course will helpyou understand the opportunities and challenges that await you.

This year the AP Macroeconomics Exam will begin at 8:00a.m. on Thursday, May 15, 2014.

For our study of Macroeconomics we will use McConnell, Brue and Flynn’s AP 19th edition Economics as our text. You are responsible for bringing this book to class each day and forreturning it in good condition at the end of the semester. Many students have found it costeffective and convenient to purchase a used copy of the text online.

Topics to be covered throughout the course

Ten Principles of Economics

We will discuss how economic production is measured

The role of the financial sector in determining a nation’s fate

How to thinking like an Economist

The interdependence and the gains/loss from Trade

Impact of International Trade

The Market Forces of Supply and Demand

Measuring a Nation’s Income

The correlation of national income and price determination

How to measuring the Cost of Living

Production and Growth

Saving, Investment and the Financial System

The impact of unemployment

The Monetary System

Money Growth and Inflation and stabilization

Open Economy Macroeconomics: Basic Concepts

Theory of practice

Aggregate Demand and Aggregate Supply

The influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff between Inflation and Unemployment

Debatingeconomic policy

How the utilization of resources within and across a county impacts economic activity, both decline and progress, and how policymakers go about making decision impacting aggregate programs.

In addition to the McConnell text, we will undertake extensive readings from daily newspapers,news magazines, Internet news services, and other relevant sources of macroeconomicsinformation such as scholarly journals and publications of the regional United States FederalReserve banks. We will also engage in writing and various in-class activities.

Class Policies and Procedures:

First off, regular timely attendance is essential to the smooth functioning of this class. Yourteacher understands that some excused absences are unavoidable and asks that you scheduletime away from class so as to cause the fewest possible interruptions to your learning. Also, letyour teacher know of upcoming absences and take responsibility for making up anyassignments resulting from excused absences.

It is recommended that you develop good relationships with fellow students in class so that youcan consult others’ class notes when necessary. As upperclassmen you alone are responsiblefor catching up any absences.

An Important Note about Unexcused Absences and Late Work

My general policy is not to accept late work in this AP class. Even the most diligent studentexperiences scheduling difficulties from time to time that interfere with timely completion ofhomework, however. As part of our study of economics, a mechanism will be created that willpermit a limited number of opportunities to submit late assignments for credit. Details will beprovided in class.

By definition, there is no justification for an unexcused absence at EHS. Under nocircumstances will students be permitted to submit late work that was due on the day of anunexcused absence. Your mature understanding of this policy will be greatly appreciated. Iunderstand that you all have choices to make. Please recognize that some choices result innegative consequences.

No Excuses Make Ups Policy

Students with excused absences are expected to make up missed tests and quizzes promptly.

Make up tests and quizzes must be scheduled in writing on a day approved by Mr. Snyder within three days of the missed test/quiz.Students whomiss a scheduled make up will receive a grade of 0 forthat assignment. If you cannot attend a scheduled make up notify me as soon as possible.

No Excuses!

You will need a 3-ring binder

You can expect to receive a number of handouts during the semester and it will be helpful to beable to retrieve them quickly and reliably. You will also be expected to use the binder for storingany ongoing writing assignments, including weekly readings.

Grading

Grades will be based not only on test and quiz scores, but also on homework,readings, in-class contributions, and indicators of overall preparedness and enthusiasm for thecourse material. The success of this class depends on each student’s willingness to prepareand contribute, and to display an attitude consistent with doing one’s best on the AP Exam. Wecan only take from the class what each of you puts into it. Please do your best, always. Yourbest efforts will help everyone in your class.

In addition to 5 course long projects, you will be quizzed weekly on assigned readings and tested on each chapter. We will review the released AP Macroeconomic tests and you will be expected to take a released AP exam in January and a second one shortly before the actual exam. All students will be required to take the exam and it will be a major grade in the marking period in which the actual exam occurs. The course is divided into 7 Units, I will provide you with details in class. You will be tested and quizzed in each unit on: Content – Vocab, Graphs and Charts, FRQs, LRQs and MC.

Common Traits of Successful AP Economics Students

Students who have been successful in AP Macroeconomics have a set of characteristics incommon. These include:

1. The student assumes personal responsibility for learning economics.

The instructor, the text, and the study guides cannot teach you economics. They are merelyresources to help you learn the subject. The successful student uses each to good.

2. The student brings and uses appropriate prerequisite skills in English, math, andcritical thinking to the learning of economics. The ability to read the English languagecarefully and precisely is obviously needed. The ability to deal with algebraic concepts andsimple geometry is also required for success. Finally, the successful student must be able tothink critically on issues.

3. The student devotes appropriate time and energy to learning the subject. Reading thetext in a skimming fashion saves time in the short run but those savings are costly over time.Successful students read the text very carefully and take notes on the concepts presented.

4. The student masters basic concepts and vocabulary before moving on to more difficultmaterial. Economics concepts tend to build on each other, and the failure to comprehend theinitial concepts guarantees problems in the future.

5. The student reinforces new knowledge. Rather than moving on to the next chapter, thesuccessful student reads the chapter summary and discussion questions even though they may

not be assigned.

6. The student prepares properly for economics examinations. The foundation of good testresults is the vocabulary of the subject. Next come the basic concepts, followed by the more four complex relationships. Finally come the practice test questions and the sample essays. Onlyafter all these are understood can the student feel prepared.

7. The student does not rely on mere memorization. While there is rote memory work in

learning any subject, economics is not a set of answers to be memorized. Economics is a way

of analyzing problems and predicting results.

8. The student is willing to ask for help and utilize the available resources. The studentwho succeeds in economics class is willing to ask questions in and out of class. That studentrecognizes the value of time and, rather than struggle for hours with a concept, is willing to askquestions in class or to phone the instructor (not after 9:30 p.m.) to clarify concepts.

9. The student attends class. Life is far too short not to learn all you possibly can the first timearound. See also, An Important Note About Unexcused Absences and Late Work, above.

10. The student sees economics in everyday life and applies class concepts to thenational news and to personal decisions. In order to understand the subject thoroughly, youmust use it daily. Practice makes perfect but only if you practice perfectly!

COURSE OUTLINE: Essential Questions

Basic Economic Concepts

CONTENT/ESSENTIAL QUESTIONS

  • How does scarcity affect decision making?
  • How does comparative advantage impact international trade?
  • What is the difference between change in supply/demand and change in quantities supplied/demanded?
  • What relationship does the circular flow of money model illustrate?

Skills/Graphs/Formulas

  • Interpret Production Possibility Curve
  • Create and Analyze Supply and Demand Graphs
  • Create and Interpret comparative advantage Charts
  • Analyze the Circular Flow of Money Model
  • Change in Demand/Supply v Change in quantity demanded/supplied
  • Factors of Supply and Demand
  • Price Floors and Ceilings
  • Elastic and Inelastic Supply and Demand

Measuring Economic Well Being

CONTENT/ESSENTIAL QUESTIONS

  • Are the components of the GDP more important than the actual GDP? Explain.
  • How does inflation impact GDP?
  • How effectively does the unemployment rate measure the economic well-being of a nation?

Skills/Graphs

  • Compute GDP using various means (C+I+G+(X-M)) and (W+I+R+P)
  • Breakdown the components of GDP (Income and Expenditure Approaches)
  • Interpret statistics with regard to the business cycle
  • Real GDP= Nominal GDP/ Price Index
  • Analyze the Phillips Curve
  • Distinguish between different types of unemployment (including what constitutes the natural rate of unemployment
  • Price index= market basket for current year/ market basket for base year

Developing Fiscal Policy

CONTENT/ESSENTIAL QUESTIONS

  • How does a shift in aggregate demand impact the price level and real GDP? (Classical and Keynesian perspectives)
  • How does the Keynesian cross illustrate the multiplier effect?
  • What is the impact of taxation and spending on fiscal policy?
  • How has fiscal policy impacted past and current economic well-being?

Skills/Graphs/Formulas

  • Analyze the Keynesian cross
  • Compare and contrast economic models
  • Apply models to current and past fiscal policies
  • Expansionary and Recessionary Gaps
  • Credit Market Graph
  • Demand Pull Inflation
  • Cost Push Inflation
  • Spending Multiplier
  • MPC +MPS = 1
  • Phillips Curve (Long and Short Run)
  • MPC = change in consumption /change in income
  • MPS= change in savings/ change in income

Money, Banking, and Fiscal Policy

CONTENT/ESSENTIAL QUESTIONS

  • What is the purpose of money?
  • What are the types of money?
  • What is the role of the Federal Reserve System?
  • How does the Fed use monetary tools to manipulate the economy?
  • What monetary policies are used during a recession? An expansion?

Skills/Graphs/Formulas

  • Money Multiplier= 1/required reserve ratio
  • Analyze the difference between M1, M2, and M3

International Economics

CONTENT/ESSENTIAL QUESTIONS

  • Why is international trade important? (Open and Closed Economy)
  • What is the impact of a strong/weak dollar on the US trade balance?
  • How does the foreign exchange rate impact fiscal and monetary policy?
  • How does a weak/strong dollar impact foreign and domestic spending and investment?

Skills/Graphs/Formulas

  • Foreign Exchange Rate Graph
  • Comparative Advantage Chart

Applications of Macroeconomics

  • Federal Budget Activity
  • The Fed Challenge
  • Stock Market Portfolio Project
  • Business Project
  • Economic Theory Paper & Presentations
  • Helpful Websites

All the graphs you will need to know on youtube:

  • Youtube Professor

Breaking down concepts in 60 seconds.

According to the College Board, the objective portion of the AP Macro exam will breakdown as follows:

Content Area Percentage Goals of Exam(multiple-choice section)

I. Basic Economic Concepts (8–12%)

A. Scarcity, choice, and opportunity costs

B. Production possibilities curve

C. Comparative advantage, specialization, and exchange

D. Demand, supply, and market equilibrium

E. Macroeconomic issues: business cycle, unemployment, inflation, growth

Course introduction: discussion of course goals, requirements, and approach via the syllabus. How will you use the book and its ancillaries? Write out three or more things you intend to do in pursuit of economic knowledge. We will then finish the course introduction and begin our discussion of the course requirements; graphs, their meaning, and economic data.

II. Measurement of Economic Performance (12–16%)

A. National income accounts

1. Circular flow

2. Gross domestic product

3. Components of gross domestic product

4. Real versus nominal gross domestic product

B. Inflation measurement and adjustment

1. Price indices

2. Nominal and real values

3. Costs of inflation

C. Unemployment

1. Definition and measurement

2. Types of unemployment

3. Natural rate of unemployment

In this unit we will measure national output/income

III. National Income and Price Determination (10–15%)

A. Aggregate demand

1. Determinants of aggregate demand

2. Multiplier and crowding-out effects

B. Aggregate supply

1. Short-run and long-run analyses

2. Sticky versus flexible wages and prices

3. Determinants of aggregate supply

C. Macroeconomic equilibrium

1. Real output and price level

2. Short and long run

3. Actual versus full-employment output

4. Business cycle and economic fluctuations

IV. Financial Sector (15–20%)

A. Money, banking, and financial markets

1. Definition of financial assets: money, stocks, bonds

2. Time value of money (present and future value)

3. Measures of money supply

4. Banks and creation of money

5. Money demand

6. Money market and the equilibrium nominal interest rate

B. Loanable funds market

1. Supply of and demand for loanable funds

2. Equilibrium real interest rate

3. Crowding out

C. Central bank and control of the money supply

1. Tools of central bank policy

2. Quantity theory of money

3. Real versus nominal interest rates

V. Stabilization Policies (20–30%)

A. Fiscal and monetary policies

1. Demand-side effects

2. Supply-side effects

3. Policy mix

4. Government deficits and debt

B. The Phillips curve

1. Short-run and long-run Phillips curves

2. Demand-pull versus cost-push inflation

3. Role of expectations

VI. Economic Growth (5–10%)

A. Definition of economic growth

B. Determinants of economic growth

1. Investment in human capital

2. Investment in physical capital

3. Research and development, and technological progress

C. Growth policy

VII. Open Economy: International Trade and Finance (10–15%)

A. Balance of payments accounts

1. Balance of trade

2. Current account

3. Financial account (formerly known as capital account)

B. Foreign exchange market

1. Demand for and supply of foreign exchange

2. Exchange rate determination

3. Currency appreciation and depreciation

C. Imports, exports, and financial capital flows

D. Relationships between international and domestic financial and goods markets

About the AP Macroeconomics Exam

The exam is 2 hours and 10 minutes long, and includes a multiple-choice section and a freeresponsesection. You'll have 70 minutes to complete the multiple-choice section. You'll have60 minutes for the free-response section Fifty percent of the section score is based on the longessay while each short essay contributes one-quarter to the free-response score. The multiplechoicesection accounts for two-thirds of the grade and the free-response section is the finalone-third.

Lesson Plans

Week 1

Monday-Tuesday

Students will analyze Production Possibility Curve graphs.

Syllabus

Define economics, scarcity and shortageprinciples of economics

PPC curves

Wednesday

Students will analyze PPC graphs.

PPC curves

Thursday-Friday

Students will explain absolute and comparative advantage.

PPC quiz (Friday)

Absolute and comparative advantage problems

Week 2

Monday-Tuesday

Explain absolute and comparative advantage.

Video clip

work problems on board

Comparative Advantage FRQ

Wednesday

Identify determinants of Supply and Demand; analyze Supplyand Demand graphs

COWS-Google Apps

Explain projects (current events)

Supply and Demand

Lecture

Problems

Thursday-Friday

Identify determinants of Supply and Demand; analyze Supplyand Demand graphs

Absolute and Comparative Advantage quiz (Friday)

Supply and Demand lecture and problems

FORTHCOMING EVENTS

-Unit 1 multiple choice

-PPC quiz

-Unit 1 vocabulary test

-Absolute and comparative advantage quiz

-Supply and Demand determinants quiz

-Project check (1st part)

Week 3

Monday

Review first two weeks

Tuesday

Analyze supply and demand graphs.

Unit 1 multiple choice
Price floors and ceilings problems

Wednesday

Analyze GDP(Gross Domestic Product); assess understanding of fundamental economic terms

Unit 1 vocabulary test

Complex circular flow model (GDP) lecture

Thursday

Analyze GDP

S & D graph quiz

Complex circular flow model (GDP) lecture

Friday

Analyze GDP

1st part of project DUE (GRADED)
Is this included in GDP?
Does this count in GDP?

FORTHCOMING EVENTS

Unit 1 vocabulary test

Unit 1 Multiple choice

S & D graph quiz

S & D determinants quiz

Unit 1 test 1/28

Week 4

Monday

Analyze GDP.
Unit 1 test

Is this included in GDP?

Calculating GDP

Tuesday

Analyze GDP

Real or nominal GDP

Calculate GDP (expenditures, value added, income)

Wednesday

Analyze GDP

GDP quiz

Business cycle

Who is helped and who is hurt by inflation?

Types of unemployment

Thursday

Analyze GDP

GDP--FRQ as class

Friday

Analyze GDP

Begin preparing for Unit 2

FORTHCOMING EVENTS

Unit 1 test

GDP quiz

2nd part of project

Unit 2 multiple choice

Unit 2 vocabulary test

Review for GDP test and FRQ

1. Determine if good will or will not be counted inGDP and explain.

2. Two methods of calculating GDP; shortcoming of GDP; in addition to nominal GDP what do

you need to knowto determine standard of living

3. Calculate GDP for a country; calculate inflation rate; impact of inflation on real and nominal