Teaching Assistance Manual
Economics A Contemporary Introduction TENTH EDITION
William A. McEachern University of Connecticut
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CONTENTS Introduction ..................................................................................................................................... 1 1
The Art and Science of Economic Analysis .................................................................................... 3
2
Economic Tools and Economic Systems ........................................................................................ 6
3
Economic Decision Makers ............................................................................................................ 9
4
Demand, Supply, and Markets ...................................................................................................... 12
5
Elasticity of Demand and Supply .................................................................................................. 15
6
Consumer Choice and Demand ..................................................................................................... 18
7
Production and Cost in the Firm ................................................................................................... 21
8
Perfect Competition ....................................................................................................................... 24
9
Monopoly ...................................................................................................................................... 27
10
Monopolistic Competition and Oligopoly ..................................................................................... 30
11
Resource Markets........................................................................................................................... 33
12
Labor Markets and Labor Unions .................................................................................................. 36
13
Capital, Interest, Entrepreneurship, and Corporate Finance .......................................................... 40
14
Transaction Costs, Imperfect Information, and Behavioral Economics ........................................ 43
15
Economic Regulation and Antitrust Policy ................................................................................... 46
16
Public Goods and Public Choice ................................................................................................... 49
17
Externalities and the Environment ................................................................................................ 52
18
Income Distribution and Poverty ................................................................................................... 55
19
Introduction to Macroeconomics ................................................................................................... 58
20
Tracking the U.S. Economy .......................................................................................................... 61
21
Unemployment and Inflation ........................................................................................................ 64
22
Productivity and Growth ............................................................................................................... 67
23
Aggregate Expenditure and Aggregate Demand ........................................................................ 70
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iii
24
Aggregate Supply .......................................................................................................................... 73
25
Fiscal Policy .................................................................................................................................. 76
26
Federal Budgets and Public Policy ................................................................................................ 79
27
Money and the Financial System .................................................................................................. 82
28
Banking and the Money Supply .................................................................................................... 85
29
Monetary Theory and Policy ......................................................................................................... 88
30
Macro Policy Debate: Active or Passive? ..................................................................................... 91
31
International Trade ........................................................................................................................ 94
32
International Finance ..................................................................................................................... 97
33
Economic Development ............................................................................................................... 100 Appendix A: Classroom Presentation ......................................................................................... 103 Appendix B: Leading a Discussion.............................................................................................. 111 Appendix C: Quizzes and Exams ................................................................................................ 116 Appendix D: Special Challenges Facing the Foreign Graduate Assistant .................................. 121
Contents
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INTRODUCTION Lectures represent an effective way to provide large amounts of information, but lectures are mostly one-way communications. Since students are often reluctant to ask questions, particularly in large classes, only the looks on their faces and the results of exams provide the instructor with feedback. But this feedback is sporadic, limited, and impersonal. Thus, the instructor often has difficulty gauging how the material is being received. One vehicle for encouraging two-way communications is to carry on more class discussion. If the class is already relatively small—say, 25 or fewer students— discussion can become a regular part of the class. But because principles classes are often large, these classes at some institutions are broken down into small weekly sections, providing students with more individual attention, more time to discuss the material, more of an opportunity to ask questions, and a place to take quizzes. Although many instructors might benefit from this manual, the focus here is on smaller classes, where discussion is possible. Sometimes these discussion sections are directed by graduate students, who are variously referred to as teaching assistants, graduate assistants, discussion leaders, or teaching fellows. Whether seasoned teacher or green graduate student, however, each instructor faces many of the same challenges in the classroom. For some of you, this manual may provide new insights. For others it may simply remind you of things you already know. As Mark Twain said “None of us is smart enough to remember all we know.” To have good ideas in the classroom, we need lots of ideas. In using this manual, think of yourself as a prospector looking for a few good teaching ideas. Each chapter number of this manual corresponds with a chapter in my hardback principles textbook (Economics: A Contemporary Introduction, Tenth Edition). The first 18 chapters of this manual correspond with the first 18 chapters of the micro paperback (Microeconomics); and the final three chapters in this manual correspond with the final three chapters of the Microeconomics. If you are using the macro paperback (Macroeconomics), Chapters 1 through 4 in this manual correspond with those same chapters in Macroeconomics; Chapters 19 through 33 of this manual go with Chapters 5 through 19 in Macroeconomics; and the final three chapters in this manual correspond with the final three chapters of the Macroeconomics. Each chapter in this manual contains (1) a brief overview, (2) a detailed outline, (3) chapter objectives and quiz material, (4) topics for class discussion, (5) warnings about trouble spots in the chapter that warrant special attention, (6) additional examples, and (7) some “What If?” questions. The appendices to this manual provide teaching assistance on (a) presenting material, (b) generating and sustaining class discussion, (c) preparing, administering, and grading quizzes, and (d) the special challenges confronting foreign graduate assistants. Even seasoned teachers may find some of this appendix material helpful. Don’t forget about the other components of the teaching package that could help. The Instructor’s Manual answers all end-of-chapter questions and offers chapter summaries and lecture guidance, including when to use PowerPoint slides. Also available are a Study Guide, Test Bank, downloadable PowerPoint slides, computer-assisted tutorials, on-line help, and my newsletter, The Teaching Economist. Other resources include colleagues, newspapers, periodicals, the Internet, and your daily observations of the economics all around you. Most colleges also offer some sort of teaching support through reference material, teacher counseling, and videotaping for self-appraisal. Many good books and articles have been written about college teaching. The following is a short list of references you may find helpful:
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