Chapter 10
3. Production function Y = KN
a. If K = 49 and N = 81, Y = 4981 = 7*9 = 63
b. If K and N both double, output also doubles:
98162 = 126, or, in general, (2K)(2N) = 2KN = 2Y
c. Yes, multiplying all inputs by the same factor multiplies the output
1. l
Ah economy is represented by the following system of equations and identities:
s=5+o.?sr;r =YT
1= lsnmi
G = 250;T=2i
d:
M
Money demand: (F) = Y 511i
M
M0113? supply: 3 = TED
C is private oons umption, "f income, T taxes, I business investment, [3 gov
Chapter 7 problem set
Question 2. Start at medium-run equilibrium, that is natural level of output and
unemployment. Then suppose there is a tax cut. What happens in the IS-LM model and
what happens in the AS-AD model?
i
P
AS
LM
AS
LM
P1
P0
i1
IS
IS
Y
Yn
Text book Questions
Chapter 3
Q2)
C = 160 + 0.6YD
I = 150
G = 150
T = 100
a. Equilibrium GDP (Y)?
Z=C+I+G
Plug above behavioral functions into this equation, which gives you,
Aggregate function : Z = 160 + 0.6(Y-100)+150+150 = 400 + 0.6Y
Equilibrium condi
204A Intermediate Macroeconomics (Discussion session)
Dec. 8th 2011
Announcement
1. Final exam: Dec 13th, 10:30 12:30, Thompson hall 106
2. I will hold extra office hour on next Monday.
You can use either time slot: 10-11am or 4-5pm.
3. Discussion today (
Econ 204
7/9/15
The United States financial crisis of 2008 began with a series of subprime loans that
became sold to and pooled together by financial institutions which allowed investors to purchase
packages of these loans known as mortgage-backed securit
Text book Questions
Chapter 3
Q2)
C = 160 + 0.6YD
I = 150
G = 150
T = 100
a. Equilibrium GDP (Y)?
b. Disposable income YD ?
c. Consumption spending (C)?
Q3) use the above equations
a. Solve for equilibrium output. Compute total demand. Is it equal to
prod
Chapter 19 Homework Answer Key
Question #2: Real and nominal exchange rates and inflation
Using the definition of the real exchange rate (and Propositions 7 and 8 in Appendix 2 at the end of the book), you
can show that
In words, the percentage real appre
Chapter 11
Paradox of savings/long run growth question:
The paradox of savings is the name for a conclusion we reach in our short run incomeexpenditure equilibrium analysis of the savings rate: If the savings rate increases, this
causes consumption to fal
Chapter 3 problem set answer key
Question 2
C = 160 + 0.6YD
I = 150
G = 150
T = 100
Solve for the following variables:
a. Equilibrium GDP (Y)
Option 1: Use equation 3.8 and substitute in the given parameters.
Option 2: Write down the equilibrium condition
Chapter 20 HW Answer Key
2. Consider an open economy with flexible exchange rates. Suppose output is at the
natural level, but there is a trade deficit. What is the appropriate fiscal-monetary policy
mix?
We will take appropriate to mean that the policy g
Supplemental Study Questions for the Midterm Exam (to be combined
with study questions for Quizzes 1 and 2)
2*.1. Give short, concise definitions of the following:
a. isoquant- Collection of all baskets of inputs that produce the same
output.
b. total pro
Econ 204 Chapter 6 Homework Answer Key
Problems #3 and 6
QUESTION 3: The natural rate of unemployment: Suppose that the markup of goods prices over marginal cost is
5%, and that the wage-setting equation is W = P(1-u), where u is the unemployment rate.
a.
Econ 204
Chapter 4 Homework Answer Key
3. Consider a bond that promises to pay $100 in one year.
a. What is the interest rate on the bond if its price today is $75? $85? $95?
We use this formula (from pg. 71):
! =
$"#!$!
$!
If the price is $75:
! =
$"#!
Question .1. [50 points
a. Explain howa crisis that originated in the nancial sector rapidly.r spread to the real sector in the US in 200?
03. ftpomrst
o. Explain howthe Emit-08 crisis in the US generated a global nancial and economic crisis; that is, exp
uesijon .2 [50 points
Suppose that the gayemment increases public expenditure with no change in taxes.
a. 1il'il'hatwould be the eiects oilhis policy [the decrease in governmentspending on equilibrium oulput in the
goods market? Explain howand why eouilil
Review Guide for Econ 204 Final, Fall 2016
Review Class, Wednesday Dec. 14, (in Class, Dec 14th, 8 to 8.50 AM)
1. Labor Market (Chapter 6)
wage determination W = Pe F(u,z)
price determination P = W (1+m)
bargaining power => real wage (W/P)
2. Putting All
CHAPTER 8 HOMEWORK: Qs 2, 8, & 9
Question 2
a. This statement is not necessarily true: see pages 166-169 for discussion of why since the 1970s we do
not see the original Phillips curve relationship reflected in the economy.
b. This strategy does not work
Question .3 [50 points
Consider that the Federal Resene Elanli: decidestci undertake a largescale asset purchase resulting in an increase in
m ciney su p-ply.
a. 1iI'iI'hatiiyoulo be the eiect ofsuch a policy on equilibrium interest rate in the money mark
Econ Final
Monetary police
Definition: the use of policy tools, such as regulation and issuance of currency, to
affect the money supply, credit, interest rates, and exchange rates.
This contrast with fiscal policy which is government spending and taxation
Econ 204
Ten Things to Know for the Final Exam
Ten Things to Know for the Final Exam
chap 18
1. Role of the interest rate, the exchange rate and relative prices for (1) investment decisions in
an open economy, (2) consumption of domestic vs. foreign goods
Review Guide for Econ 204 Final, Fall 2016
Review Class, Wednesday Dec. 14, (in Class, Dec 14th, 8 to 8.50 AM)
1. Labor Market (Chapter 6)
wage determination W = Pe * F(u, z)
price determination P = W * (1+m)
W/p = 1/1+m
bargaining power => real wage (W/P
UMass Econ 204 Online, Summer 2017
Midterm Examination Instructions:
-For Part I: Choose three (3) questions from Part I (3x30=90points), Please label
your selected questions with the appropriate numbers. If you decide to answer all the
questions, only th
Answer all parts of the test.
You have 2 hours to do finish the test and upload your answer in the Blackboard system.
Question 1 (30 points)
a. The dynamics of capital accumulation over time can be expressed as follows:
K is capital stock, A is technology
Oliver Wyeth
29204956
Question 1 (8 points)
Using the information in the following table (Table 1), answer questions (1.1), (1.2), (1.3) and (1.4).
Table 1 Nominal and Real GDP of the U.S.
Year 2015
Year 2016
Nominal GDP of the U.S.
$18,036.6 billion $18,
ECON 204
An Li
Black Gold Response
Oliver Wyeth
29204956
Black Gold is a documentary from 2006 that looks at the birthplace of coffee, Ethiopia,
and how their economy revolves and plays into the second most actively traded commodity,
coffee. Developing na
Should policy makers worry about the hypothesized trade-off between unemployment and
inflation?
The hypothesized trade-off between unemployment and inflation is of a concern for policy makers. If
they are to create policies that aim at reducing the unempl
Oliver Wyeth
29204956
Question 1 (10 points)
A countrys labor market can be described using information in Table 1. Using information in Table 1,
answer questions (1.1), (1.2) and (1.3)
Table 1 A countrys labor market
Wage setting equation
W = P (1 - u)
P