Homework4 - recession What was Keynes’s answer to this...

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Homework 4 Due date for this homework can be found on Blackboard. You can either type or hand-write your homework. Homework must be stapled and submitted in class as a hard copy. No e-mailed homework accepted. 1. [Chapter 12] 2. [Chapter 12] Find all the Nash Equilibria of the following game and explain how you found them.
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3. [Chapter 12] 4. Macro [Chapter 1] a) According to Keynes, why do recessions happen? Which two policies should the government use to stabilize the business cycle? b) Explain the following terms: contraction, recession, depression, recovery, boom, peak, and trough. Use a graph to indicate which part of the business cycle corresponds to each term. 5. Macro [Chapter 1] a) How should fiscal and monetary policies be used, according to Keynes? Make a chart to explain the details of each policy during a recession and during an inflationary boom. b) Explain a government’s budget. How would Keynesian policies affect the budget deficit during a
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Unformatted text preview: recession? What was Keynes’s answer to this concern? 6. Macro [Chapter 1] a) Explain the stagflation of 1970s. What does supply-side economics propose? How did Clinton and Obama disagree with supply-side economics? b) When were the last 4 recessions in the US? How do the Great Depression, double-dip recession, 2001 recession, and the Great Recession rank from the worst to the least bad? Which recession had the highest unemployment rate since the Great Depression? Which one had the largest decline in production and highest long-term unemployment rate? 7. Video on Keynes: Watch the following BBC documentary about Keynes. Write a 2-paragraph reaction to the video. As usual, first paragraph is the summary of major points in video. Second paragraph is your reaction. Each paragraph must have at least 6 sentences. Keynes: ...
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