Unit Code: ECN601
Unit Name: Intermediate Macroeconomics
Description: Macroeconomics is about analyzing and interpreting the economic behavior of economic agents and designing policies to raise the living standards of the society. Agents such as consumers, producers, exporters and importers (which we call the private sector) invest their incomes, time and efforts to undertake risks in order to maximize their objectives. However, within the context of this course, it must be noted that individual behavior and aggregate economy wide behavior of agents are valued differently Generally, the government intervenes when markets fail. There are two market clearing mechanisms-price and quantity. Markets determine prices which in turn determine equilibrium quantity. This is what New-Classical believes. Sometimes markets take a very long time to clear. In this situation, policy intervention is required or else persistent unemployment/recession may grow for long. These policies directly or indirectly determine the equilibrium quantity- there is limited role for markets or price system because they cannot adjust effectively. This is the rationale for intervention as proposed by the New Keynesians. Apart from correcting the inefficiencies, government intervention is required to see that macroeconomic problems such as inflation, unemployment, recession etc are avoided or minimized. These problems need active policy intervention. In this course, you will go into details of these issues and policies to evaluate them. You will learn the AD-AS and IS-LM models that will be used for policy analysis in the course. .
Learning Target Outcomes:
Prerequisite Sentence: or consent from HOD.
Credit Point: 15
Offered In: Semester 2