FI405 Public Finance

for SP 2012

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Mission Statement: Park University provides access to a quality higher education experience that prepares a diverse community of learners to think critically, communicate effectively, demonstrate a global perspective and engage in lifelong learning and service to others.

Vision Statement: Park University, a pioneering institution of higher learning since 1875, will provide leadership in quality, innovative education for a diversity of learners who will excel in their professional and personal service to the global community.


FI 405 Public Finance


SP 2012 HO


Kao, Robert


Assistant Professor of Finance


Ph.D. – Texas A&M University
M.S. – University of Nebraska-Lincoln

Office Location

MacKay 27C

Office Hours

Monday - Thursday 12:00 - 2:00 PM or by appointment

Daytime Phone

(816) 584-6852


Class Days


Class Time

9:00 - 9:50 AM


EC141 and EC142

Credit Hours



Public Finance – A Contemporary Application of Theory to Policy, 10th Edition by David N. Hyman, South-Western/Cengage Learning, 2011
ISBN-13: 9780538754460

Textbooks can be purchased through the MBS bookstore

Textbooks can be purchased through the Parkville Bookstore

Additional Resources:
eCompanion Course Web Site: lecture notes, paper guideline, reading resources, and other class-related materials.

McAfee Memorial Library - Online information, links, electronic databases and the Online catalog. Contact the library for further assistance via email or at 800-270-4347.
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Course Description:
FI405 Public Finance: The impact of public finance on individual and business economic decisions; detailed consideration of the principles of taxation, public expenditures, the federal budgeting process, and state and local fiscal systems. Prerequisites:EC141 and EC142 3:0:3

Educational Philosophy:

  • Establish a classroom where ideas can be shared, students can be challenged in areas of topic learning and real knowledge can be applied. 
  • Create an interactive environment which is based on lectures, readings, quizzes, dialogues, examinations, assignments, websites, and topic-related writings. 
  • Motivate the class with available on-campus seminars and/or hands-on experiences that would support student learning.

  Instructor Learning Outcomes

  1. Understand the principles of government expenditures.
  2. Explain the application of tax theory to tax policy.
  3. Define the government budget balance and debt.
  4. Explain state and local government finance.
Class Assessment:
Grades will be based on the student’s performance on two in-class tests, homework assignments, project, and final exam. Your overall score in the course will be determined mechanically as the weighted average of the five component scores.


Your grade will be determined solely by the components listed above. All exams are in-class, closed book. They cover material from lectures, assigned readings, and homework assignments. Exams will strive to test comprehension and not merely memorization skills. 
Test 1 (covering module 1):                       20%
Test 2 (covering module 2):                       20%
Final (comprehensive; module 1-3):           25%
Homework Assignments:                           15%
Paper/Project Report:                                20%
Total                                                      100%

At the end of the course, your accumulated points will be converted to grades based on the following scale:
90% - 100%    = A
80% - 89%      = B
70% - 79%      = C
60% - 69%      = D
Below 60%      = F

The course grade for students will be based on the overall average of homework and tests taken during the course in accordance with the weighting of the various requirements as stated in the syllabus.

All final exams in all School of Business courses will be comprehensive and will be closed book and closed notes. They will constitute 30% of the total course grade and will not be a take-home exam. They will be completed during the test week in the period designated by the registrar or by the Proctor in the case online courses. If calculators are allowed, they will not be multifunctional electronic devices that include features such as: phones, cameras, instant messaging, pagers, and so forth. Electronic Computers will not be allowed on final exams unless an exception is made by the Dean of the School of Business.

Late Submission of Course Materials:
Late submission of material will not be accepted without prior arrangements being made with the instructor. No late assignments will be accepted after the regular semester ends.

Classroom Rules of Conduct:
Use of cell phones, pagers, iPOD, or other electronic device is strictly prohibited from class.  Should a student be expecting some sort of emergency phone call (IE baby, child, parent illness), it is the student's responsibility to leave the class to take a call.  With exception to the above listed examples, all phones should be turned off prior to class beginning.

Course Topic/Dates/Assignments:



Chapter and Subject



Government Expenditures

Chapter 6: Cost-Benefit Analysis

P: 1, 2, 4, 5, 7


Chapter 7: Subsidies

P: 1, 2, 3, 4


Chapter 8: Social Security and Insurance

P: 1, 3, 5, 6


Chapter 9: Health Care

P: 1, 2, 3, 5

Test 1

Chapters: 6-9

Module 2:

Government Finance

Chapter 10: Introduction

P: 1, 3, 5, 7


Chapter 11: Taxation, Prices, Efficiency and the Distribution of Income

P: 1, 3, 5


Chapter 12: Budget Balance and Government Debt

P: 1, 3, 4, 5


Chapter 18: State and Local Government Finance

P: 1, 3, 4

Test 2

Chapters 10-12, 18

Project Proposal Due

Module 3: Taxation

Chapter 13: Theory of Income Taxation

P: 1, 2, 3, 4


Chapter 14: Personal Income

P: 1, 2, 3, 5


Chapter 15: Corporate Income

P: 1, 2, 3


Chapter 16: Consumption and Sales

P: 2, 3, 4


Chapter 17: Wealth, Property, and Estates

P: 1, 3, 4

Project Due

Final Exam

Comprehensive Problems

May 9, 8:00-10:00


*The instructor reserves the right to adjust the course schedule to take into consideration of the class progress and unforeseen circumstances.

Academic Honesty:
Academic integrity is the foundation of the academic community. Because each student has the primary responsibility for being academically honest, students are advised to read and understand all sections of this policy relating to standards of conduct and academic life. Park University students and faculty members are encouraged to take advantage of the University resources available for learning about academic honesty ( or Park University 2011-2012 Undergraduate Catalog Page 93

Plagiarism involves the use of quotations without quotation marks, the use of quotations without indication of the source, the use of another's idea without acknowledging the source, the submission of a paper, laboratory report, project, or class assignment (any portion of such) prepared by another person, or incorrect paraphrasing. from Park University 2011-2012 Undergraduate Catalog Page 93

Attendance Policy:
Instructors are required to maintain attendance records and to report absences via the online attendance reporting system.

  1. The instructor may excuse absences for valid reasons, but missed work must be made up within the semester/term of enrollment.
  2. Work missed through unexcused absences must also be made up within the semester/term of enrollment, but unexcused absences may carry further penalties.
  3. In the event of two consecutive weeks of unexcused absences in a semester/term of enrollment, the student will be administratively withdrawn, resulting in a grade of "F".
  4. A "Contract for Incomplete" will not be issued to a student who has unexcused or excessive absences recorded for a course.
  5. Students receiving Military Tuition Assistance or Veterans Administration educational benefits must not exceed three unexcused absences in the semester/term of enrollment. Excessive absences will be reported to the appropriate agency and may result in a monetary penalty to the student.
  6. Report of a "F" grade (attendance or academic) resulting from excessive absence for those students who are receiving financial assistance from agencies not mentioned in item 5 above will be reported to the appropriate agency.

Park University 2011-2012 Undergraduate Catalog Page 96

Disability Guidelines:
Park University is committed to meeting the needs of all students that meet the criteria for special assistance. These guidelines are designed to supply directions to students concerning the information necessary to accomplish this goal. It is Park University's policy to comply fully with federal and state law, including Section 504 of the Rehabilitation Act of 1973 and the Americans with Disabilities Act of 1990, regarding students with disabilities. In the case of any inconsistency between these guidelines and federal and/or state law, the provisions of the law will apply. Additional information concerning Park University's policies and procedures related to disability can be found on the Park University web page: .

Additional Information:



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Last Updated:1/6/2012 12:19:49 PM