ECO3202 - Assignment 1

# ECO3202 - Assignment 1 - John P Kilzi ECO3202 Applied...

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John P. Kilzi ECO3202 Applied Macroeconomics Fall 2009 Assignment 1 September 8, 2009 1. Imagine a World with two countries, where country A only produces beef, cheese and wine, whereas country B only produces cars and computers. Suppose country A sold 100 pounds of beef, 50 pounds of cheese and 70 bottles of wine to country B and country B sold 3 cars and 10 computers to country A in 2008. If the price of a pound of beef is \$8, a pound of cheese is \$4, a bottle of wine is \$5, a car is \$500 and a computer is \$50, _ What is the current account balance of country A in 2008? CA of Country A = - \$650 _ What is the current account balance of country B in 2008? CA of Country B = + \$ 650 _ Which country has to sell some of its asset? and why? 2. Solve question 1 in numerical problems at the end of chapter 1. a. 2002: 12 tons/worker 2003: 13 tons/worker b. 7.69% c. 2002: 9.09% 2003: 4.35% d. 25% 3. Solve question 3 in numerical problems at the end of chapter 2. 4. Solve questions 4 in numerical problems at the end of chapter 2.

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ECO3202 - Assignment 1 - John P Kilzi ECO3202 Applied...

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