EC 355 International Trade and Finance Fall 2006

TH 9:35 – 11:15 AM J. Yee

Office Hours: M,W 1:00-2:30 PM, TH 1-2PM, or by appointment in WBC 103, x8485;

e-mail:Janice.Yee@wartburg.edu

Pre-requisite courses: EC 141, EC 142 or permission of the instructor

Required Text:

International Economics M. Kreinin 2006, 10^th edition

(Highly)Recommended Text:

The Travels of a T-Shirt in the Global Economy P. Rivoli 2005 John Wiley and Sons, Inc.

About the Course:

This course will introduce you to the intricacies of international trade of goods and services and the complexities of international monetary policies. During this semester, we will explore the reasons behind trade policies, why some economic agents are in favor of trade and why others vehemently oppose it. We will also consider the linkage between macroeconomic policies and individual countries’ currency stability.

At the completion of this course, students should be able to

· Recognize the relationship between national and international economies

· Understand and distinguish between comparative and absolute advantage

· Understand how national, regional, cultural influences can impact international economic decisions

· Understand how countries gain from international trade and how those gains may not be divided equally over different sectors of an economy

· Recognize why countries erect barriers to trade and the implications of such barriers

· Understand the concept of balance of payments

· Recognize different types of international organizations

· Understand how international financial flows affect economies’ macroeconomic policies

Course Requirements:

2 quizzes (10% each) Midterm Exam (20%)

Oral Presentation/participation (10%) Research Paper/Presentation (20%)

Final Exam (30%)

The following is the tentative schedule for the above:

Quiz #1 September 28 Midterm Exam week of October 17th

Quiz #2 November 21 Final Exam(during Finals Week)

Course Readings:

I. International Trade Theory

A. The Exchange of Goods

Kreinin, Chapters 1-3

B. Barriers to Trade

Kreinin, Chapters 4-5

C. Economic Integration

Kreinin, Chapters 6-9

II. International Financial Economics

A. The Demand for and Supply of Foreign Exchange

Kreinin, chapters 10-11

B. Exchange rate systems and Internal Balance

Kreinin, chapter 12-14

C. External Balance

Kreinin, Chapters 16-17

Additional Information:

1) Exams and Quizzes

Quizzes will be given to test your understanding of the material being presented. In essence, they will test your ability to use the tools which will be discussed in class. They will also serve as an indicator to me and hopefully to you of what your weaknesses and strengths are so that you may better prepare for your exams.

Exams will be short answer and essay and will be composed of two parts. The first portion will be true/false with explanation. The second portion will be composed of several essay questions. A few weeks before the exams, you will be given a list of approximately 40 true/false questions, from which I will choose ten(10) for the upcoming exams. You may and should work on these questions with your classmates in order to prepare for the exam adequately.

Plagiarism and/or cheating will NOT be tolerated. Students engaging in such activity will receive an F and/or a failing grade for the quiz/exam/course grade. "By attending Wartburg College, students are demonstrating their dedication to the Honor Code. The Honor Code reminds students of their responsibility to promote academic honesty by opposing cheating and plagiarism and reporting dishonest work."

“The Americans with Disabilities Act of 1990 (ADA) provides protection from illegal discrimination for qualified individuals with disabilities. Students requesting instructional accommodations due to disabilities must arrange for such accommodations by contacting the Dean of Students Alexander (Lex) Smith. He can be reached at the Student Life office, Saemann Student Center 195, 352-8260, alexander.smith@wartburg.edu. Accommodation should be requested PRIOR to affected assignment due dates.”

2) Oral Presentations/Participation

Groups of two will present chapter(s) from the Rivoli book. The expectation is that we will complete this book by the midterm break and therefore, presentations on the book will be complete by then. Presentations should be informative and exhibit a certain amount of critical thought on the part of the presenter. You should not read the presented paper or merely regurgitate information. Doing so will have a very negative effect on your presentation grade! Each class member is REQUIRED to ask at least one question of the presenters. Failure to do so will count against you in your class participation grade.

For each presentation, the instructor will provide the class and the presenter with an additional set of questions, topics or information to be conveyed to the class.

3) Research Paper and Presentation

A research paper which analyzes the travels of a good through the world market will also be required. This research paper should be done as a group(no larger than three people) and needs to analyze the process by which the good is made and brought to the market place. In many ways, you will need to produce a paper similar to the book by Rivoli.

In choosing a good, you should attempt to find one that is simple, rather than complex as in the Rivoli text (a t-shirt as opposed to a car). Your analysis should identify the origin of the good, and the process by which it becomes a final market ready product. As you trace its origins you should attempt to determine added-costs and/or value along the way and the reasons for those costs/value. In addition, you should note any particular policies that have impacted your good and organizations which have attempted to change those policies.

The paper is due on the last day of class and presentations of your work will occur during the last weeks of the term.