Introductory Macro and Microeconomics
| Subject | Introductory Macro and Microeconomics |
| Semester | 1st semester (autumn) |
| Type | compulsory |
| ECTS | 9 ECTS |
| Study programme: | Economics / 1st Bologna cycle |
| Primary language: | Slovene |
The course is delivered in Slovenian and is a compulsory course in accordance with the officially approved curriculum of the undergraduate study programme in Business Studies. The course is divided into two parts. The first part – Macroeconomics – covers the fundamental concepts for understanding the economy at the aggregate level. The second part – Microeconomics – covers the fundamental concepts for understanding the behaviour of individual economic agents, consumers and producers, as well as an introduction to market structures, above all perfect competition.
Prerequisites
Students must understand the basic concepts of business economics, company operations and management as covered by secondary-school curricula. The course requires the use of mathematical techniques with which students must already be familiar, namely linear and quadratic equations, and differentiation and partial differentiation. Students must have a sufficient command of Slovenian to communicate with lecturers and fellow students, to follow the lectures and to understand the study materials provided during the course.
Content (Syllabus outline)
- I. Macroeconomics
- 10 principles of macroeconomics
- Macroeconomics as a discipline
- Fields and research tools of the macroeconomist
- Concepts of macroeconomic analysis
- Data in macroeconomics
- GDP
- CPI
- Unemployment
- Gross domestic product
- Determinants of GDP
- prices of factors of production
- Distribution of income
- Determinants of demand for goods and services
- Equilibrium in the goods market
- Money and inflation
- The long-run theory of inflation (flexible prices, market clearing)
- The model of a small open economy
- Net exports
- Net capital outflow
- The national income identity
- The effect of economic policy on net exports
- Determinants of the exchange rate
- The model of unemployment
- The natural rate of unemployment
- Frictional unemployment
- Structural unemployment
- II. Microeconomics
- Introduction to microeconomics:
- The fundamental economic problem;
- Positive and normative economics;
- The production possibility curve and the budget line;
- Consumer behaviour, utility and the indifference curve;
- The optimal consumption bundle.
- Demand, supply and market equilibrium:
- The individual demand curve, the individual supply curve and equilibrium;
- The market demand curve, the market supply curve and equilibrium;
- The law of supply and the law of demand;
- Elasticity of demand and supply;
- Government intervention: price regulation;
- Consumer surplus, producer surplus;
- Economic efficiency in perfectly competitive markets.
- The theory of production:
- The production function and technical efficiency;
- Fixed and variable factors of production;
- Production in the short run: total product, average product, marginal product, the law of diminishing marginal product, elasticity of production;
- Production in the long run: the concept of the isoquant; returns to scale.
- The theory of costs:
- Different concepts of cost;
- Short-run costs: total cost, average cost, marginal cost, the relationship between cost functions and production functions;
- Long-run costs: the concept of the isocost line and of optimal output, long-run average cost and marginal cost, the concept of economies of scale;
- The optimal combination of employed factors of production.
To introduce students to the fundamental economic problem and to the fields of macro- and microeconomics. To teach students how to use basic economic concepts and how to think like an economist. To develop the ability to analyse the causes and consequences of economic phenomena. To introduce the methodological instruments and research methods for analysing basic economic phenomena. To develop the ability to apply knowledge of economics in practice.
Intended learning outcomes
Competences the ability to use the terminology of macroeconomic analysis and to solve basic macroeconomic problems; the ability to understand and evaluate social and economic processes; the ability to use and evaluate macroeconomic data (GDP, inflation, unemployment); the ability to understand and evaluate economic policy; the ability to use the terminology of microeconomic analysis and to solve basic microeconomic problems; the ability to recognise the nature and behaviour of producers, consumers and investors; the ability to understand managerial concepts and processes in companies; the ability to understand basic theory in the field of micro- and macroeconomics; the ability to solve various macro- and microeconomic problems on the basis of quantitative and qualitative information. Learning outcomes Having passed the examination, the student will be able to: apply basic knowledge of macroeconomic analysis; understand aggregate supply and demand, GDP, consumption, investment, exports and imports, the demand for money and the supply of money; understand the fundamentals of macroeconomic equilibrium, inflation, unemployment, economic policy and economic growth; apply basic knowledge of microeconomic analysis; understand consumer behaviour, the law of supply, the law of demand and the workings of the market mechanism; understand the theory of production, the theory of costs and the fundamentals of perfect competition; apply analytical skills in order to draw valid conclusions.
Learning and teaching methods
Forms of work
Frontal teaching and
independent and individual student work
Methods of work- explanation
- conversation/debate
- case study
- solving tasks
- involving guests and practitioners in the teaching
Assessment consists of three elements: 1) a seminar paper; 2) a mid-term test in Macroeconomics; 3) a mid-term test in Microeconomics. Each test contributes one half of the final grade. The seminar paper forms part of the partial grade in Macroeconomics. For a positive final grade, each individual test must also be passed. To pass, at least 50% of all points must be obtained.
Readings- Prašnikar, Janez, Domadenik, Polona, Koman, Matjaž. 2015. Mikroekonomija. Ljubljana: Ekonomska fakulteta.
- Mankiw, Gregory N. 2007. Macroeconomics. Worth Publishers.
- Davorin Kračun: Uvod v ekonomijo in mikroekonomika
- Samuelson, Paul Anthony Nordhaus, William D.: Ekonomija
- Maks Tajnikar: Mikroekonomija s poglavji o teoriji cen
- before and after lectures
- by arrangement
