Wednesday, January 2, 2008

Outline of Topics (detailed)

Part I: Introduction to Economics

A. What is Economics?

What determines prices?
Prices have little to do with value
Prices are based on relative scarcity and desirability

Unlimited Needs and Wants

Economic Products

Economic Resources
Blue collar workers
White Collar workers
Special Types of Labor used in Business
International Business Specialists
Green collar workers
Physical Capital
Human Capital
Financial Capital
Natural Resources
Fossil fuels

Macro vs. Micro

Positive vs. Normative Analysis

Limitations of Economics as a Field of Study

B. Economic Perspectives
Opportunity costs
Sunk costs
Incentives always matter
Trade can make everyone better off

C. Simple Economic Models
Circular Flow Diagram
Household and Business Firms
Adding Government
Adding International Trade
Production Possibilities Frontier
Constant Opportunity Costs
Increasing Opportunity Costs
A Change in Resources
A Change in Technology
Illustrating Unemployment
Illustrating the Benefits of Specialization and Trade
D. Supply and Demand Analysis
Prince Controls
Price Floors
Minimum Wage Laws
Price Ceilings
Rent Controls
Changes in Demand
Decrease in Demand
Oprah vs. Texas Cattlemen´s Association
Increase in Demand
Medical Benefits of Wine and Grape Juice
Oprah´s Book Club
Changes in Supply
Decrease in Supply
Orange Juice
Increase in Supply
Bovine Growth Hormone (BGH)
Changes in Supply and Demand
Increase in Supply and Increase in Demand
Increase in Supply and Decrease in Demand
Decrease in Supply and Increase in Demand
Decrease in Supply and Decrease in Demand

E. Personal Investments
Are Credit Card Companies the Crack Dealers of the Financial World?
Unscrupulous practices

Compound Interest: the Importance of Starting to Save Early

Types of Investments
Transactions Money
Bank accounts
Short Term Savings
Certificates of Deposit (CDs)
Money market mutual funds
Long Term Savings
Bond mutual funds
Stock mutual funds
Blue chip
Aggressive growth
Real Estate

Investments in the News:
Dow Jones Industrial Average
S&P 500

Investing Strategies
Payroll Deduction
Dollar Cost Averaging
Mutual Funds: Special Insight or dumb luck?

Part II: Macroeconomic Policy

A. Macroeconomic Policy Goals
a. Economic Growth
i. Importance
1. Historical Perspective
2. Geographical Perspective
ii. Measurement
1. GDP
2. GDP per capita
3. Real GDP
4. Real GDP per capita
5. Limitations of these measurements
a. Standard-of-living vs. Quality-of-life
iii. Alternative Theories of Economic Growth
1. Supply-side economics

b. Low Unemployment
i. Importance
1. Effect on Economic Growth
2. Well-being of the unemployed
3. Well-being of the employed
a. Taxes to support the unemployed
b. Crime and unemployment
ii. Measurement
1. Unemployment rate
2. Labor force participation rate
3. Limitations of this measurement
a. Discouraged workers
b. Underemployment
c. Inaccurate data and deceptive answers

c. Low Inflation
i. Importance
1. Effect of Economic Growth
2. Effect on Economic Efficiency
3. Redistribution of Income
ii. Measurement
1. Price indices
a. Consumer Price Index (CPI)
b. Producer Price Index (PPI)
c. GDP Deflator
2. Limitations of these Measurements

B. Macroeconomic Policy Tools
a. Monetary Policy
i. What is Money?
ii. How Monetary Policy Affects the Economy
1. Expansionary Monetary Policy
2. Contractionary Monetary Policy
iii. The Federal Reserve System
1. Structure of the Fed
a. Twelve Regional Federal Reserve Banks
b. Board of Governors
c. Federal Open Market Committee (FOMC)
2. Functions of the Fed
3. Monetary Policy Tools
a. Required reserve ratio
b. Federal funds rate
c. Open market operations
i. Open market purchases (of government securities)
ii. Open market sales (of government securities)

b. Fiscal Policy
i. Taxation
ii. Government Spending

Part III: Contemporary Economic Issues

A. Political Economy
a. Conservative Republicans
i. Taxation
ii. Government Spending
iii. Gay Marriage
iv. Immigration
v. Abortion
b. Libertarians
c. Liberal Democrats

B. Economics and Religion
a. Christianity
b. Judaism
c. Muslim


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