ECONOMICS 103 OUTLINE AND PROBLEMS

OBJECTIVE


This course is designed with two main goals in mind.  The primary purpose of the course is to provide a sufficient understanding of the fundemental principles of economics.  This includes propositions about individual behavior, costs,  output of firms, market structure, and the organization of economic activity.  Given this knowledge, the student should be able to handle further courses in economics or at least understand economic issues found in a newspaper. This first goal is the standard one for every principles course. However, I have a second "higher" goal. I  want to convince you that economics is an interesting field of study, and a systematic way of thinking that is fun and powerful. In short, I don't just want to teach you "about" economics ... I want to convert you to thinking like an economist. I intend to do this with a wide variety of applications.  Throughout this course we will constantly apply economics to every aspect of your life.  I hope to surprise you, perhaps offend you, and ultimately whet your intellectual appitite towards economics.

TEXTS

The core text is Economics Principles: Seven Ideas for Thinking About ... Almost Anything, 8th edition.  You can get this book on line for $15 Cdn at McInnesCreekPress.  (see directions below).


I've also assigned the short book Candide, by Voltaire. Read it now for fun, and then you can read it again later in the course.

Costs and Theft (PLEASE READ CAREFULLY)

I've published the main textbook myself in order to provide students a cheap alternative to expensive texts. I've had to hire editors and web designers to create  the book. I have to pay for server space, the domain name, and the shopping cart program. I have to pay someone to handle all the technical issues when one of you can't download the book. I also supply hard copies of the book to the TAs and various other instructors who use it.  I also pay for promotions to try to increase the use of the book in order to bring the price down. In other words, this book has costs associated with it (not to mention my time), and I charge the $15 to try to cover those costs.

The book is used by several instructors in three different countries, but by most measures is not a big seller. In any given year I may or may not break even.   The problem, to put it bluntly, is student theft. One student buys the book and distributes it to other students.

So, let me repeat what I said last year: It is a violation of the copyright on the book to purchase one copy of the book and then share that file with others. When you purchase the book, you purchase the right to print one copy for your own use only. Furthermore, I do expect you to actually purchase the book legally. I'm hoping this appeal will stop the illegal use of the book so I can continue to offer an inexpensive book for students.

Directions for On-line Purchase [Absolutely Read This Very Carefully!]

It is very simple to purchase the book. From my home page (www.sfu.ca/~allen) simply click on the McInnes Creek Press link. 

When you go to the McInnes Creek Press site, you'll notice there is a link labelled PURCHASE BOOK. 

Once you click this link you are sent to PAYPAL, the world's largest online e-commerce transaction site. Simply fill in the required fields and hit the continue button. The book will be delivered to you in a pdf format. 

COMPLICATIONS:

The PAYPAL system is almost foolproof, and very few students have a problem getting the book.

If you have any problems, don't panic! Remember, the first 2 chapters of an earlier edition are free and available on the book page of the site, so you can always get started.

A major problem for some students is  "I don't have a credit card!"   

Although PAYPAL has an e-cheque service, if you don't own a credit card the easiest thing for you is to come by my office and pay me directly. I'll then email you the book.

ONCE YOU HAVE THE ELECTRONIC BOOK:

Once you have the file you can print the book yourself, or better, take it to a professional print shop and get it printed back-to-back and bound. The cost of this service should be approximately $20, but shop around.  If any printer questions the right to print copyrighted material, let them read the copyright statement on the second page.

HOWEVER, if you are on the SFU campus, I have a special arrangement with the Campus Printing Centre, located  in the Cornerstone building by the bus loop. This store beats everyone in terms of price and service. Also, you only have to print off your electronic receipt and take it to him, and he will then print off the book for you. 

EXAMS

There will be ONE midterm exam (potentially) worth 30% of your final mark. The final is worth 50%. The midterm is "forgivable", so if you miss it or do poorly, the weight of that exam will transfer to the final. This is a bit of insurance for you, but remember, the final exam is cumulative.

PROBLEM SETS
 

Problem sets are due periodically throughout the term, and count for 10% of your grade. Your TAs will hand out problem sets and collect them the following week.  To keep your TA happy, hand in neatly written or typed homework.  It also  helps if your graphs are done on graph paper.

Collusion on the problem sets is strongly recommended (if you do find a study partner(s), please hand in only one assignment per group). It is also suggested that you start the problems early in the week.  

A perenial problem with assignments stems from the fact that you hand them in on different days of the week. Those with tutorials on Mondays and Tuesdays feel they miss out on an extra lecture that those with tutorials on Wednesdays and Thursdays get. In the past an attempt was made to hand assignments in during lecture, in TA mailboxes, and to my office.
All methods failed, and so we are stuck with the current system. I will instruct my TA's to be aware of the problem and I
will monitor the average performance of each TA. For those of you with early tutorials, you can take some comfort in the fact that you get an extra tutorial before a midterm.

Also note that every chapter has a set of review questions with the answers supplied in the book. You should do all of these on your own.  

TUTORIAL PARTICIPATION

The final 10% of you grade comes from your participation in tutorials. Your TA will tell you how this grade is determined.

GRADES

Students always ask: "will the grades be based on a curve?" I suppose they mean, "will there be a fixed number of A's, B's, etc." The answer to this second question is "no." This is a large class. I know from experience that there will be a wide range of marks at the end of the course. Some students, remarkably, will get in the 90's. Others, just as remarkably, will get in the 20s. The rest of the class will fall in between.

Here is how I'm going to assign the grades. The average grade in the class will be a C or a C+ depending on the nature of the class. If, as a general rule, you show up on time, are ready to start on time (ie. quiet), don't fidget until the class is over, and are generally attentive during lectures, then I'll make the mean a C+.  Otherwise it is a C.  Next, I determine which marks get an `A' grade. I then take the average A grade (suppose it is 80%), and divide by 2. This is where the F's start. So if you're going to pass this course, you need to understand at least half as much as the A students. (This is the Peter Kennedy Rule). Then I just fill in the rest. If this is what you mean by "curving the grades" then the grades are curved. 

COMMUNICATION

You are welcome to come by my office during office hours, but often students find sending emails better. This is fine with me.  You may find that I send out blanket responses to the class, however, if I think the question might be valuable to everyone. I will also send emails out to the class announcing various things during the semester. So ... you should check your sfu email account regularly. When you email me, please use your sfu account, otherwise my filter might not let it through.

CHEATING

I'm an easy going guy, but if you cheat in my class ... I will hunt you down and not rest until you are expelled. Enough said.

HOW CAN I DO WELL IN THIS COURSE?

1. Do the homework ... plus.  Your book is full of questions. Do them all. Check your answers. Talk to your study partners. Practice, practice, practice. And start in the first week, don't wait until exam time.

2. Take smart notes.  The lecture outlines are on the web. Print those off and bring them to the lecture to follow. I challenge you to bring just a single sheet of additional paper to class. With this, just take the bare minimum of notes. No color pens! At the end of class, your sheet should be just chicken scratch. Just get the critical points. THEN, THAT DAY, write out a nice set of notes from the class, using your memory, outline, and small notes. Elaborate, explain, and use more than one color on the graphs. By the end of the semester you'll have wonderful notes that will help in future classes. You'll also have no need to study for the exam. It takes a little bit of work each day, but in the end the payoffs are enormous. The way most students take notes is a waste of time. 

3. Understand ... don't memorize.  Most of you are just out of high school. You've done a lot of coloring and memorizing. Now it's time to start understanding. Understanding means you have to think about a concept. It is a skill that takes practice. You'll know you understand an idea when you can apply it to a context that is different from the one used to learn it.

4. Come to class.  The ideas in 103 are sequential. If you miss lecture 4, you'll have a hard time understanding the rest of the course. The course follows the book, but the lecture is full of material not in the book  (and vise versa). 

5. Read the book ahead of time.  You'll want me to do the work for you, but if you read the relevant chapter before the lecture, and then read it again after, you'll learn a lot more in this course.

I won't lie to you. Economics 103 and 105 are probably the hardest 100 level courses on campus. They take ideas from mathematics, history, and other social sciences, and mix them all up in a model you've never seen before. They're rigorous in that they require you to think INSIDE a box. However, they are also the two most rewarding 100 level courses on campus. I hope this is a great course for you.Good luck in the course!

 

GENERAL OUTLINE

Week                                        Topic                                                         Readings

1                                      Intro and Maximization                                          Chaps. 1 & 2
 
2                                      Substitution.                                                          Chaps. 3 
 
3                                      Demand & Elasticity                                            Chaps. 4 & 5
 
4                                      Exchange                                                             Chap. 6                                               
                 
5                                     Cost and DMPs                                                    Chap. 7 
                                                                                                                  
6                                      Supply                                                                    Chap. 8

7                                     Price Taking/ Applications                                      Chaps. 9 & 10.
                                                                  

8                                     MIDTERM EXAM  Monday Oct 20 (tentative)   

9                                    Interest                                                                 Chap. 11 

10                                  Price Searching Markets             Chaps. 12  & 13

11                                   Transaction Costs                   Chaps. 14 & 15
                                                                       
12                                 Firms                                     Chaps. 16

13                                   Candide                                                                    Candide