Macroeconomics 1

• 26 hrs lectures
• 26 hrs exercises

After finishing the course students should be able: To understand theoretical basis and principles of macroeconomics. To understand the functioning of the national economy mechanism and its equilibrium, interconnection of the national economy and the world economy and their influences on particular businesses and achieving key managerial objectives. To understand how the managerial tasks are being accomplished in the national economy. To work out analytic and synthetic managerial information related to the national economy and apply it when making key managerial decisions. To use critical and analytical way of thinking in the managerial processes underlying the operation and strategic development of business activity within national and world economy.

The main objective of the course is to provide students with the knowledge of macroeconomics on the level required at higher education institutions of economic specialisation. Understanding of macroeconomic relations and connections, terms and necessary theoretical fundaments as well as understanding of possibilities and economic policy of the government.

Secondary school knowledge of economics and mathematics is expected.

Topics of lectures are the following:
- Introduction to macroeconomics. Outline of development of macroeconomic theories
- Market, market mechanism. Uneven, ineffective, unequal and unstable markets, types of market structures.
- Aggregate supply, aggregate demand. Growth and fall of aggregate demand and supply, aggregate expenditures, gradient of aggregate supply curve.
- Measuring performance of economy, national product, GNP.
- Conception of macroeconomic equilibrium, models - classical, Keynesian, Neokeynesian compromise.
- Monetary aggregates, monetary theory, money multiplier, equilibrium changes on money markets.
- Labour market, unemployment. Equilibrium and labour market, unemployment rate, forms of unemployment.
- Inflation, types of inflation, inflation and unemployment.
- Economic growth, growth models, theories of economic cycle.
- Fiscal policy - state budget, public finance, built-in stabilisers, discrete measures, expansive and restrictive fiscal policy.
- Monetary policy. Tools and aims of monetary policy, expansive and restrictive monetary policy.
- Aims of macroeconomics, effectiveness of economic policy, magical n-squares, and function of state in the economy.
- Theory of international trade, external monetary and trade policy, free trade, protectionism. International money market, international monetary system, development of monetary rates, IMF, WB, EMS.
The seminars are focused on practising the lectured topics.

Syllabus of tutorials:
1. Introduction to the course
2. Market and market mechanism
3. Model AS-AD
4. Measurement of economic output
5. The two-sector keynesian model income-expenditure
6. The money market and the money multiplier
7. Labour market and changes in the market
8. Measurement of inflation
9. The causes and phases of the economic cycle, the business cycle of the Czech Republic
10. Types of fiscal policy and its applications
11. Types of monetary policy and the reasons for their application, the policy of the CNB
12. Balance of payments, exchange rates
13. Credit hour written exam

Student gets credit if he receives at least 15 points out of 30 possible points awarded for practical seminars and fulfills a 75% participation in seminars. Points will be awarded for knowledge at seminars and final test, from which a student must obtain at least 10 points. 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

The course contains of two-hour lectures that explain principles, problems and methodology of the discipline, and two-hour practical seminar. The practical exercises promote the practical knowledge of the subject presented in the lectures and also are concerned on handling numerical tasks.

Control of students’ attendance and results is fully in competence of the lecturer. The course-unit credit is conditional on 75% attendance.