Macroeconomics 1

• 26 hrs lectures
• 26 hrs exercises

The aim of the course is to enable students to understand the basic concepts, principles, and theories of macroeconomics. The acquired competencies also include an understanding of the most important factors affecting the macroeconomic environment in the short and long term and their interrelationships. The acquired knowledge will support students in economic decision-making from the perspective of households, companies, and the state.

General knowledge of economic thinking at the secondary school level is assumed, as well as knowledge of mathematics as a tool for understanding and analyzing economic phenomena.

1. Introduction to macroeconomics. The market and market mechanisms.
2. Aggregate supply and aggregate demand. Shifts in AS and AD.
3. Measuring macroeconomic output, GDP, national income.
4. The concept of macroeconomic equilibrium, models – classical, Keynesian, neo-Keynesian compromise.

5. Business cycle. Causes and consequences of cyclical fluctuations in the economy.

6. Theory of money, money market, money multiplier, changes in equilibrium in the money market.
7. Inflation, types of inflation, inflation and unemployment, Phillips curve theory.

8. Labor market and unemployment. Labor market model. Voluntary and involuntary unemployment.
9. Fiscal policy - state budget, public finances, built-in stabilizers, discretionary measures, expansionary and restrictive fiscal
policy.
10. Monetary policy. Monetary policy instruments and objectives, expansionary and restrictive monetary policy. Inflation targeting.
11. International trade theory, foreign trade policy, balance of payments.

12. Exchange rates. Nominal and real exchange rates.

13. Evaluating the effects of economic policy.

1. Introduction to the subject. Basic economic concepts. Market and market mechanism, supply, demand, spider web theorem, principles of market clearing and setting market equilibrium.

2. Factors influencing the supply and demand curve: price elasticity, price factors, non-price factors.

3. AS-AD economic equilibrium model, the effect of price and non-price factors at the macroeconomic level.

4. Measuring macroeconomic output, GDP and national income.
5. Macroeconomic equilibrium models. Two-sector income-expenditure model, determining equilibrium in the Keynesian cross model for a two-sector economy and factors influencing changes in equilibrium. Investment multiplier.

6. First written assignment. Economic cycle model. Fluctuations in economic performance around potential output: causes and consequences.
7. Money market. The principle of deposit money creation in the economy and its relationship to economic performance. Money multiplier.

8. Inflation, measuring inflation, the impact of price level changes on economic entities.

9. The labor market and unemployment. Creating a labor market model. The natural rate of unemployment. Voluntary and involuntary unemployment.
10. Fiscal policies. Types of fiscal policy, state budget, principles of its formation and its impact on the development of the economic situation in the state.
11. Monetary policy. Types of monetary policy and reasons for their application, analysis of the impact of monetary policy on the macroeconomic situation in the state, CNB policy.
12. Second written assignment. Exchange rates and identification of factors affecting currency weakening and strengthening.
13. Awarding of credits. Corrected written assignments.

Student gets credit if he receives at least 16 points out of 30 possible points awarded for practical seminars. Points will be awarded for knowledge at seminars and final tests. The requirement to final examination is the knowledge of the course and obtained credit. The final exam is written (written test). It takes into account a comprehensive knowledge of macroeconomics, in all material respects. The maximum number of possible points is 70. Each student must obtain at least 35 points. In the overall assessment, the points of the seminars and examination are added. Students may request an oral verification.
The scale of the resulting classification:
(student may gain from exercise 30 points and max.70 points of the test, a total of 100 points)
A: 90-100 points
B: 80-89 points
C: 70-79 points
D: 60-69 points
E: 50-59 points
F: less than 50 points

Students’ attendance is not checked.