college syllabus

DE LA SALLE UNIVERSITY
Financial Management Department
RVR-College of Business
COURSE SYLLABUS
Course Code/Course Title
Prerequisite
Prerequisite to
Type of Course
Faculty
Term
Time/Room
I.

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:
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FMMACRO / Intermediate Macroeconomics
FINMAT2 and ECONTWO
NONE
Basic
Claro dG. Cordero, Jr.
1st Term, AY 2014-2015

COURSE DESCRIPTION

This course deals with the analysis of overall behavior of the economy. It will strive to explain trends of fluctuations in important macroeconomic aggregates like output, employment and prices.
It will also cover important theoretical underpinnings behind different paradigms in macroeconomics as in Keynesian and classical models. Using basic aggregate demand and aggregate supply framework, the course will explain the determination of equilibrium output, prices, interest rates under a closed economy and open economy model. It will use microeconomic foundations to explain behavior of macro variables like consumption, investment, government spending etc. Towards the end, special topics in financial markets and institutions will be discussed in the context of modern macroeconomics. Furthermore, this course will take a comprehensive look at the interplay between financial systems and macroeconomic performance. Particularly, it will look into the role financial systems play in generating macroeconomic volatility.
II.

OBJECTIVES/VALUES

At the end of the course, the students should be able to do the following:
Cognitive (Knowledge)
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.

Identify the different macroeconomic models like the classical and Keynesian types;
Differentiate between exogenous and endogenous variables in economic models;
Explain the concept of open and closed macroeconomic models;
Identify the aggregate demand and aggregate supply;
Explain the interaction of aggregate demand and aggregate supply and its connection to the money and goods markets;
Identify and explain the basics of financial markets and financial institutions;
Identify and explain the financial intermediation and its role in the macroeconomy;
Differentiate financial integration and financial globalization;
Know the brief history of financial development;
Explain the link between macroeconomic theory and the role of finance;
Know financial volatility and how it contributes to economic (in)stability; and,
Identify the role of international finance on financial crises.

Cognitive (Skills)
1.
2.
3.

Appreciate macro-financial models and literature;
Analyze current financial instability against the backdrop of current macroeconomic issues; and,
React, with sound basis and logic, to current, both empirical and applied research papers, macroeconomics and finance issues.

Affective / Value Aims
1.
2.
3.

III.

Imbibe the attitude that social responsibility and high ethical standards are major considerations in financial and macroeconomic stability;
Appreciate the value reading and continuous learning;
Develop the attitude on keeping abreast on the latest news developments in the financial world.

OUTLINE OF TOPICS

WEEK
NO.
1, 2 & 3

TOPICS

4, 5, 6 & 7

Part I. An Introduction to Finance and Macroeconomics
1. The Basics of Financial Markets and Financial
Institutions
2. A Brief History of Financial Development
Part II. Macroeconomic Theory and the Role of Finance

8
8, 9 & 10

3. Business Cycles and Early Macroeconomic Theories of
Finance
4. Keynesian, Monetarist, and Neoclassical Theories
5. New Institutional Theories of Finance: Models of Risk and the Costs of Credit Intermediation
6. New Institutional Theories of Finance: Models of Credit
Rationing
Midterm Exam
Part III. Financial Volatility and Economic (In)stability

11 & 12

7. The Role of Financial Systems in Monetary and
Stabilization Policy
8. Banking Crises and Asset Bubbles
Part IV. International Finance and Financial Crises

13

9. Capital Flight and the Causes of International Financial
Crises
10. International Financial Crises: Policies and Prevention
Part V. Special Topics
11. Financial Integration: Regional or Global?

MAJOR
REFERENCES
T. Knoop

NO. OF
HOURS
6.0
3.0

T. Knoop
& G. Mankiw
3.0
6.0
1.5
1.5
1.5
T. Knoop &
G. Mankiw
4.0
4.5
T. Knoop &
G. Mankiw
3.0
3.0
Assigned
Readings
1.5

14

IV.

12. Financial Globalization versus Financial Integration
Final Exam
Total Hours

TEACHING METHODS/STRATEGIES

Lectures, reading assignments, random recitations, surprise quizzes and exercises, etc.
V.

COURSE REQUIREMENTS

1. Formal testing of one (1) midterm exam and one (1) final exam
2. Prompt submission of assignments, papers, etc.
3. Always be ready for surprise recitations and/or quizzes
VI.

GRADING SYSTEM
Final Exam (Comprehensive)
Term Paper
Mid-Term Exam
Seatworks/Take Home Exercises/Graded Recitations
Attendance and Class Participation
Total

30%
20%
20%
20%
10%
100%

Grade Scale:
% Equivalent
97.00 – 100.00
93.00 – 96.99
89.00 – 92.99
85.00 – 88.99
80.00 – 84.99
75.00 – 79.99
70.00 – 74.99
Below 70.00

VII.

GPA
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.00
W
UW

Description
Excellent
Superior
Very Good
Good
Satisfactory/Pass (minimum grade to pass)
No Credit
No Credit
Failed/No Credit
Officially Withdrawn
Unauthorized Withdrawal (equivalent to Failed)

TEXT/MATERIALS

Main References:
Knoop, T A (2008): MODERN FINANCIAL MACROECONOMICS: Panics, Crashes, and Crises,
Blackwell Publishing, USA.
Mankiw, G (2003): MACROECONOMICS, Worth Publishers, Sixth Edition.

1.5
2.0
42

References:
Sachs, J and F Larrain (1993): MACROECONOMICS IN THE GLOBAL ECONOMY, Prentice
Hall, Inc.
Rudiger, D, F Stanley and S Richard (2000): MACROECONOMICS, Mc-Graw Hill Inc.
Blanchard, O (2005): MACROECONOMICS, Prentice Hall International, Inc., Third Edition.
VIII. ONLINE RESOURCES (to follow)
IX.

CLASS POLICIES

Students are expected to follow the relevant provisions of the student handbook, with particular emphasis on attendance and tardiness, offenses/penalties on cheating and plagiarism, proper decorum, respect for classmates and persons in authority, and due process for complaints/grievances. Students are expected to have made advanced readings on the assigned topics before these are discussed in class. The students are also expected to take down notes during the class, as lecture materials will not be distributed and will only be covered inside the classroom.
Students are to adhere to on-time submission of periodic requirements. Late submission due to illness allowed only on the next class session after the deadline and must be accompanied by a medical certificate noted by the Vice Dean of the college. Requirements submitted late will be subjected to a 20 percent deduction from the final score.
Other policies as may be discussed in class that would facilitate a workable environment for effective learning.
X.

CONSULTATION

Student consultation hour will be strictly by appointment. Scheduling for appointments must be coursed through email: [e-mail]

References: Sachs, J and F Larrain (1993): MACROECONOMICS IN THE GLOBAL ECONOMY, Prentice Hall, Inc. Rudiger, D, F Stanley and S Richard (2000): MACROECONOMICS, Mc-Graw Hill Inc. Blanchard, O (2005): MACROECONOMICS, Prentice Hall International, Inc., Third Edition.