Economic Growth

Suppose you are hired as a member of the council of economic advisers to a government in a small open economy. This economy has been maintaining the flexible exchange rate regime successfully, maintaining a stable price level. However, there has also been a debate within the country whether or not it should adopt a fixed exchange rate regime. If you are asked to provide your opinions, ideas, and recommendations based on what you have learned in your intermediate macroeconomics course, like this Econ 359, what would you say? Especially, as a newcomer to this country and a new member of the council, what more information would you want to know to provide sensible recommendations? 1. Introduction: Economic Growth – Chapters 7-8 (2 weeks) 2. A Closed-Economy One-Period Macroeconomic Model – Chapters 4-5 (3 weeks) 3. A Closed-Economy Two-Period Model (with Investment) – Chapters 9-11 (3 weeks) 4. A Monetary Intertemporal Model and Business Cycles – Chapters 12 (2 weeks) Applied Topics: (We will cover as much as we can, if not everything.) 5. International Macroeconomics – Chapters 15-16 6. Money, Inflation, and Banking – Chapters 17-18 7. Unemployment – Chapter 6 (Your answer to Part 3 must be within one page, and note that the amount of writing will not be correlated with your mark.)

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