ECON 105

Solve and interpret standard models of consumer behavior

• State and explain the Law of Demand
• Explain the role of constraints and opportunity cost in consumer choices

Solve and interpret standard models of market interaction

• Calculate and interpret real and nominal interest rates
• Calculate and interpret the growth rate of total factor productivity (Solow residual)
• Describe the characteristics of monetary assets (i.e., what makes money money)
• Describe the quantity theory of money, its implications, and whether it fits the evidence
• Describe the theory of purchasing power parity, its implications, and whether it fits the evidence
• Explain the implications of diminishing vs. constant returns to capital for long-run growth
• Use a one-period macroeconomic model to predict the response of macroeconomic variables to economic conditions and policy actions
• Use supply and demand (liquidity preference?) to describe the relationship between the money supply and interest rates
• Use supply and demand to identify the determinants of exchange rates
• Write and interpret the neoclassical aggregate production function
• Calculate and interpret the effect of government fiscal policy on deficits, debt, national savings, and investment
• Calculate growth rates from levels, and levels from growth rates
• Describe the leading explanations for observed cross-country and time-series patterns in long-run growth
• Distinguish between the short run and the long run
• Identify automatic stabilizers
• Identify the potential costs of inflation, deflation, and disinflation
• Use supply and demand (labour market) to identify the determinants of employment and/or unemployment
• Use supply and demand (loanable funds) to identify the determinants of interest rates, savings, and investment

Interpret key economic data

• Calculate and interpret real and nominal exchange rates
• Calculate and interpret the unemployment rate and labour force participation rate
• Calculate real and nominal GDP and their expenditure components in a simple economy
• Calculate the CPI, GDP deflator, and inflation rate in a simple economy
• Describe concepts, methodology and limitations in the main macroeconomic statistics
• Relate the production, expenditure and income approaches to calculating GDP

Discuss the role of theory, evidence, and measurement in economic analysis

• Describe the scientific method and its role in economics

Critically evaluate assumptions in economic/econometric models

• Explain the role of assumptions in economic models
• Understand limited role of GDP as a measure of production (versus wealth, versus welfare)

Compare and critically evaluate economic arguments

• Define the "natural rate of employment" and assess its relevance to the macroeconomy
• Distinguish between different explanations for unemployment

Formulate written economic arguments evaluating or supporting a position

• Write a brief paragraph (e.g., on an exam) that explains or applies economic concepts

Apply economics to everyday situations

• Analyze the equilibrium effects of government interventions (taxes, subsidies, regulation)
• Intepret a real-world situation using the concepts of scarcity, substitution, opportunity cost, and equilibrium
• Describe the incentives facing participants in a real-world situation
• Predict the economy's response to changes in market conditions                

Use economics to evaluate specific policies

• Discuss the arguments for and against active stabilization policy
• Discuss the arguments for fixed versus flexible exchange rates
• Discuss the arguments for monetary versus fiscal policy
• Explain the zero lower bound problem and the use of unconventional monetary instruments
• Identify exchange rate policy choices and evaluate their consequences
• Identify fiscal policy choices and evaluate their consequences
• Identify monetary policy choices and evaluate their consequences
• Evaluate policies and factors that influence long-run growth
• Identify regulatory (bank and financial market) policy choices and evaluate their consequences

Evaluate current events using tools of economics

• Evaluate current events as they relate to the general course content

Describe important institutions in the economy and their roles

• Describe the characteristics of a bank run and the potential role of the lender of last resort

Describe important events in economic history and their current relevance

• Describe and explain key aspects of the gold standard, Great Depression, 1970's inflation episode, and 2008 financial crisis
• Describe important cross-country patterns in long-run growth
• Describe important patterns and events in Canada's main macroeconomic time series