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Learning Objectives
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Course aim: The purpose of the course is to give students an understanding of (i) movements in the economy over the business cycle, (ii) macroeconomic stabilisation policy (monetary and fiscal) in closed and open economies, and (iii) basic aspects of economic growth.
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Explain basic macroeconomic terminology (e.g. "growth", "recession", "natural unemployment", "trade balance deficit" etc.) in a comprehensive way
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Describe how real GDP is determined in the short run, the medium run and the long run.
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Describe the main determinants of other important macroeconomic variables such as inflation, unemployment, real wage, interest rate, exchange rate etc.
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Perform simple algebraic calculations related to developments in the main macroeconomic variables
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Describe and explain the assumptions and relations of the main macroeconomic models (e.g. the IS/LM model, the AD/AS model, etc.).
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Illustrate diagrammatically these models, perform policy experiments (like increasing government spending or changing the money supply) and interpret verbally what happens when moving from one equilibrium to another.
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Solve algebraically simple macroeconomic models in order to determine the value of the variables in equilibrium (national income, interest rate, consumption, investment etc.)
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Prerequisite
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Students not enrolled in BSc in Business Administration & Service Management must document a level in English equal to TOEFL 575, and A level in mathematics equal to Danish level B
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Examination
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Macroeconomics
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Assessment
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Written Exam
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Marking Scale
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7-step scale
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Censorship
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External examiners
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Exam Period
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December/January
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Aids
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Closed Book
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Duration
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4 Hours
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- The exam takes place on CBS computers
-Graphs can be written by hand
-Students may bring simple language dictionaries to the exam
- Students may bring a non-programmable calculator to the exam
Re-examination. Re-take examinations and make-up examinations are subject to the same regulations as the ones noted above |
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Examination
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Prerequisites for Attending the Exam
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Course Content
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This course offers a general introduction to macroeconomics. We ask questions such as, ‘What determines production, unemployment and inflation in the short and medium run?’ To answer this, we develop an analytical framework based on equilibrium conditions in three markets: the goods market, the financial market and the labour market. This framework is also used to analyze questions like, ‘What is the scope for a government to stabilise the economy using fiscal and monetary policy?’ Moreover, issues related to the open economy are addressed, such as capital mobility, exchange rates, balance of payments etc. Finally, we briefly discuss issues related to economic growth.
The following issues are addressed in the course:
• Demand for goods
• Demand for money
• Labour market
• Inflation and unemployment
• Fiscal and monetary policy
• The open economy
• Economic growth |
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Teaching Methods
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Lectures & workshops
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Literature
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Blanchard, O., Macroeconomics, Pearson, N.J., Latest version.
Blanchard chap. 1 and 2: Introduction to macroeconomics
Blanchard chap. 3: The goods market
Blanchard chap. 4: Financial markets
Blanchard chap. 5: The IS-LM model
Blanchard chap. 6: The labor market
Blanchard chap. 7: The AS-AD model
Blanchard chap. 8: Unemployment
Blanchard chap. 9: Inflation, activity and nominal money growth
Blanchard chap. 18-21: The open economy
Blanchard chap. 10-12: Economic growth |
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