ECO-20037 Open Economy Macroeconomics Assessment Brief  - KU

Published: 15 May, 2025
Category Assignment Subject Economics
University Keele University (KU) Module Title ECO-20037 Open Economy Macroeconomics
Assessment Type: Assignment  word count: 2,000 
Assessment Title: Take home assignment-online task  Submission Deadline (date and 5me): 19thMay 2025 |  1 pm

ECO-20037 Assessment Details:

Take-home coursework assignment covering the entire syllabus. 

Module Learning Outcomes of ECO-20037:

 In this assessment the following module learning outcomes will be covered: 

  1. Explain the behaviour of households, firms and governments in terms of a small set of unifying economic principles 
  2. Evaluate economic theories and apply them to the analysis of an open economy 
  3. Utilise data from a variety of sources and work effectively with information technology 
  4. Assess the effect of policy and other changes on the economy, recognising the basic tenants of policy evaluation 5 Utilise a variety of mathematical skills and techniques to analyse the behaviour of small open economies

The assignment will also allow you to demonstrate the following Keele Graduate Attributes: 

  • Attribute 1. an open and questioning approach to ideas, demonstrating curiosity, independence of thought and the ability to appreciate a range of perspectives on the natural and social worlds
  • Attribute 2. an appreciation of the development and value of your chosen subjects of study, awareness of their contexts, the links between them, and awareness of the provisional and dynamic nature of knowledge
  • Attribute 3. information literacy: the ability to locate, evaluate and synthesise large amounts of frequently conflicting information, ideas and data
  • Attribute 4. the ability creatively to solve problems using a range of different approaches and techniques, and to determine which techniques are appropriate for the issue at hand
  • Attribute 5. an appreciation of the social, environmental and global implications of your studies and other activities, including recognition of any ethical implications
  • Attribute 6. the ability to communicate clearly and effectively in written and verbal forms for different purposes and to a variety of audiences
  • Attribute 7. the knowledge, skills, self-confidence and self-awareness actively to pursue your future goals
  • Attribute 8 the ability and motivation to participate responsibly and collaboratively as an active citizen in the communities in which you live and work
  • Attribute 9. a professional and reflective approach, including qualities of leadership, responsibility, personal integrity, empathy, care and respect for others, accountability and self-regulation
  • Attribute 10. the flexibility to thrive in rapidly changing and uncertain external environments and to update skills and knowledge as circumstances require.

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ECO-20037 SECTION A 

QUESTION 1

Consider an open economy described by the following behavioural equations:

ECO-20037 Open Economy Macroeconomics Assignment

Where all variables are expressed in millions of pounds and the interest rate is expressed in percentage terms. The Central Bank sets an interest rate of 2. Usual notation applies. The price level is fixed and assumed equal to 1. 

  1. Find the equilibrium of the IS-LM model.
  2. Provide a qualitative analysis of the impact of an expansionary fiscal policy on the equilibrium in (a) and explain your results.

QUESTION 2 

Provide detailed and accurate diagrams, accompanied by a brief commentary, to describe the following:

  1. The impact of an increase in government spending on the current account balance
  2. The impact of an increase in consumer confidence on the IS curve

ECO-20037 SECTION B 

Students are expected to answer ALLquestions in Section A and ONE question in Section B.

QUESTION 3

 "An economy in a fixed exchange rate regime loses monetary policy as a stabilisation tool". Explain and discuss, with reference to the appropriate economic models studied in the module.

QUESTION 4

By using the economic models studied in this module, evaluate the effectiveness of fiscal policy in stabilising the output in an open economy with flexible exchange rates.

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