Course

Course Code
Credit points
FHEQ level
Prerequisites

1a INTRODUCTION TO ECONOMICS
(to be added at later date)
30
Level 4
None

Faculty
Course
leader

ECONOMICS
Masud Ally

DESCRIPTION
This is an introductory course which assumes no prior knowledge of economics.
It is split into two components: Microeconomics and Macroeconomics.
The course equips students with an understanding of microeconomics and
macroeconomics, and prepares them for Microeconomics and Macroeconomics
(Level 5), as well as topics in Applied Economics (Level 6). The objective of the
course is to familiarise students with the building blocks of the subject and to
cement a firm understanding of basic concepts in economics. Students should
understand the intuition behind the results and be able to apply economic
theory to the real world.
AIMS
The course aims to:

Provide students with a firm foundation upon which to build their

further studies in economics.
Introduce students to modelling economic problems.
Introduce students to fundamental concepts in economics and thereby
allow them to start to think like an economist.

LEARNING OUTCOMES
On successful completion of the course, students should be able to:
Knowledge and understanding

K1a
K1a, K2a
K1a
(K1a)

Articulate the distinction between things which are real and

nominal and why economists think in most cases people should
care about real things. (K1a, K2a)
Summarise and discuss fundamental ideas in economics, like
opportunity cost, deadweight loss, marginal analysis and Pareto
efficiency. (K1a)
List and explain some basic tools of fiscal and monetary policy.

Subject-specific skills
S1a, S3a
Undertake simple comparative statics analysis in economic models.
(S1a, S3a)
S1a, S2a
Model simple problems effectively by considering which issues are
important to the issue at hand and which can be safely ignored.
(S1a, S2a, S3a)
Transferable skills
T1a, T2a

Reflect on the challenges of, and gain practice in, presenting

complex economic ideas so that they can be easily understood by a
non-specialist audience. (T2a PPE)

LEARNING AND TEACHING

This Level 4 course is taught in the Michaelmas and Hilary term with one 90minute lecture each week and a one-hour weekly tutorial.
Lectures are interactive and students are expected to engage in discussion
throughout. A revision session is held in the Trinity term.
Course information and supplementary materials are available through the
Moodle VLE Introduction to Economics page.
Students are required to attend and participate in all the formal and timetabled
sessions for this course. Students are also expected to manage their directed
learning and independent study in support of the assignments and tasks they
are given in classes.
ASSESSMENT
Formative
Students prepare work for each weekly tutorial, which include short questions
and problems. They are given detailed feedback, but the assessment does not
form part of their grade.
The objective of formative assessment is to motivate students to attempt
economic theory challenges, in the form of past examination questions or
similar. This enables students to assess their own ability, test their

understanding of lecture material independently, and identify gaps in their

knowledge.
Summative
Students are assessed by two 2-hour end-of-year unseen examinations, one for
the Microeconomics half of the course, and one for the Macroeconomics half.
Questions are typically multi-part. The first parts require the reproduction of
the solution to a model which has been covered during the year. Later parts
present an unfamiliar scenario to students which they are expected to solve
using their understanding of the relevant economics, and occasionally ask the
student to express a policy recommendation in non-technical language.
All assessment is aimed at enabling students to understand the basic principles
of Economics. Later parts of questions with unfamiliar scenarios test the
students understanding of economic modelling, and ability to present a case
both in competent economic language as well as in non-technical terms.
INDICATIVE READING
Note: Comprehensive and current reading lists for courses are produced
annually in Subject Handbooks or other documentation provided to students;
the indicative reading list provided below is used as part of the
approval/modification process only.
Core reading
Mankiw, N.G. and Taylor, M.P. (2011), Economics, Andover: Cengage Learning.
Supplementary reading
Varian, H. (2010), Intermediate Microeconomics: A Modern Approach, London:
W.W. Norton and Company.
INDICATIVE TOPICS
Microeconomics
Supply and Demand
Introduction to Economic Modelling
Elasticity and its Application
Supply, Demand and Government Policies
Consumers, Producers and the Efficiency of Markets
Economics of the Public Sector
Externalities
Public Goods and Common Resources
The Design of the Tax System
Firm Behaviour and Industrial Organisation
The Costs of Production
Firms in Competitive Markets

Monopoly
Monopolistic Competition
Oligopoly

Macroeconomics
The Data of Macroeconomics
Measuring a Nations Income
Measuring the Cost of Living
The Real Economy in the Long Run
Production and Growth
Saving, Investment and the Financial System
The Basic Tools of Finance
Unemployment
Money and Prices in the Long Run
The Monetary System
Money Growth and Inflation
Short-Run Economic Fluctuations
Keynes and IS-LM Analysis
Aggregate Demand and Aggregate Supply
The Influence of Monetary and Fiscal Policy on Aggregate Demand
The Short-Run Trade-Off Between Inflation and Unemployment
INDICATIVE EXAMINATION QUESTION
A company considers a package to help employees with the running cost of
their cars. It considers two options:
1) To offer a fixed amount of money towards the use of the car in addition
to a cost-free usage for the first X miles,
2) To participate in the actual cost of running the car (i.e. pay a certain
amount A per mile used).
a) Let X represent mileage of car usage, and Y all other goods. Discuss the
effect of each option on an employees set of possible choices, and show these
on relevant graphs.
b) Which of the options will the employee prefer if the company decided to
spend the same amount of money under the two options? On what factor(s)
does your answer to this question depend?
c) Critically analyse both schemes and evaluate their merits and
disadvantages. Which of these schemes would you advise the company to
adopt, and why?
d) Explain your answer to (c) to the company using terminology that a noneconomist can be expected to understand.

SUMMATIVE ASSESSMENT STRUCTURE

Assessment 1
Assessment type: Examination
Weighting: 50%
On-line submission: No
Duration: 2 hours
Length: N/A
Assessment 2
Assessment type: Examination
Weighting: 50%
On-line submission: No
Duration: 2 hours
Length: N/A

Date of validation

Finally approved by the Southampton Solent

University Academic Standards and
Development Committee 19 November 2014.

Date last modified