Intermediate Macroeconomics 220:321 Fall 2014
Homework 3
Instructor: Youngseok Park
(1) Rutgers Economy consumed 4 breads, 3 books, and 5 cars in 2013; it consumed 3
breads, 6 books, and 4 cars in 2014. In 2013, breads cost $3 each, books cost $3 each,
an
Mankiw, Macroeconomics 8e Chapter 1
1. Which of the following does macroeconomics NOT study?
A. changes in the unemployment rate
B. changes in the overall price level
C. changes in the prices of individual stocks
D. changes in the growth rate of real GDP
Mankiw, Macroeconomics 8e Chapter 2
1. Which of the following is a flow variable?
A. the value of the house in which you live
B. the balance in your savings account
C. your monthly consumption of hamburgers
D. the number of hamburgers in your refrigerator
Mankiw, Macroeconomics 8e Chapter 3
1. The returns to scale in the production function Y = K0.5L0.5 are:
A. decreasing.
B. constant.
C. increasing.
D. subject to wide fluctuations.
2. If a production function has two inputs and exhibits constant returns t
4/20/2015
Chapter 12
AGGREGATE DEMAND |:
APPLYING THE IS-LM MODEL (PART C)
WU KUANG CUN
Outline
- AD AS Model
(Using IS LM Model) ADAS Model
The Model of Aggregate Demand and
Suppw
The paradigm most mainstream economists
and policymakers use to think ab
4/7/2015
Chapter 12
AGGREGATE DEMAND |:
APPLYING THE IS-LM MODEL (PART A)
WU KUANG CUN
Outline
° Fiscal and Monetary Policy
0 Changes in Government spending and taxes
0 Change in monetary policy
0 Interaction between Fiscal and monetary policy 4/7/2015
5/2/2015
Chapter 19
GOVERNMENT DEBT AND BUDGET DEFICITS
WU KUANG CUN
Outline
- Two views about government debts?
0 Traditional view
0 Ricardian view 5/2/2015
Is Government Debts a Problem ?
Note: the government debt AD = G T
0 Low tax rates (tax cuts) l
4/20/2015
Chapter 12
AGGREGATE DEMAND |:
APPLYING THE IS-LM MODEL (PART B)
WU KUANG CUN
Outline
° Case Study
0 2001 Recession
0 Great Depression
0 2008 Crisis Outline
° Questions in Case Study
0 What causes recession or crisis? LM or IS
shock?
o What
3/29/2015
Chapter 11
AGGREGATE DEMAND I:
BUILDING THE IS-LM MODEL (PART A)
WUKUANG CUN
Outline
- Part I: IS curve
o a simple model: Keynesian Cross
0 deriving the IS curve
0 shifting the IS curve 3/29/2015
The Keynesian cross
Long run:
0 prices flexib
4/6/2015
Chapter 11
AGGREGATE DEMAND I:
BUILDING THE IS-LM MODEL (PART B)
WUKUANG CUN
Outline
- LM curve
0 liquidity preference
deriving the LM curve
0
o shifting the LM curve
0
exercise 4/6/2015
The Theory of Liquidity Preference
Due to John Maynard
Chapter 9
ECONOMIC GROWTH ll:
TECHNOLOGYANDPOLKY
WU KUANG CUN
The Solow Model
Part V:
° Technology growth
3/10/2015 Technological progress
In the Solow model of Chapter 8,
o the production technology is held constant.
0 income per capita is consta
3/8/2015
Chapter 8
ECONOMIC GROWTH I (PART C):
CAPITAL ACCUMULATION AND POPULATION GROWTH
WUKUANG CUN
Solow Growth Model
Part IV:
° Golden rule capital stock 3/8/2015
An increase in the saving rate
An increase in the saving rate raises investment.
.caus
3/10/2015
Chapter 8
ECONOMIC GROWTH | (PART D):
CAPITAL ACCUMULATION AND POPULATION GROWTH
WUKUANG CUN
Solow Growth Model
' Part IV:
° Population growth
CHAPTER 8 Economic Growth | 3/10/2015
Population growth
I Assume the population and labor force grow
Chapter 8
ECONOMIC GROWTH | (PART A):
CAPITAL ACCUMULATION AND POPULATION GROWTH
WUKUANG CUN
Motivation
Anything that effects the long-run rate of economic growth
even by a tiny amount will have huge effects on living
standards in the long run.
inc
2/28/2015
Chapter 6
THE OPEN ECONOMY(PART C)
WUKUANG CUN
Outline
- exchange rate
° nominal and real exchange rates, definition
° net exports function
- how is the real exchange rate determined The nominal exchange rate
e = nominal exchange rate,
the r
5/2/2015
Chapter 20
THE FINANCIAL SYSTEM
WU KUANG CUN
BRAINSTORM
What functions does the financial system perform?
Take two minutes and try to think of two or three. WHAT THE FINANCIAL SYSTEM DOES
1. Financing Investment
I The financial system helps cha
Intermediate Macroeconomics 220:321:04 Fall 2014
Mon/Wed 2:50 PM - 4:10 PM, Room: Campbell Hall A5
Instructor: Youngseok Park ([email protected])
Oce Hours: Mon/Wed 10:30 AM - 11:30 AM and by appointment at 406 New Jersey Hall
Learning Outcomes: This
Intermediate Macroeconomics 220:321 Fall 2014
Homework 6
I
Instructor: Youngseok Park
(1) Consider the two-state model of unemployment rate. Suppose that the job separation
rate (s) is 1.6% per month and the job nding rate (f ) is 20%. per month. Compute
Intermediate Macroeconomics 220:321 Fall 2014
Homework 1
Instructor: Youngseok Park
(1) Assume that the production function is given by Y = AK 0.5 L0.5 , where Y is GDP,
K is capital stock, and L is labor. The parameter A is equal to 10. Assume also that
Intermediate Macroeconomics 220:321 Fall 2014
Homework 2
Instructor: Youngseok Park
(1) Economists occasionally speak of helicopter money as a short-hand approach to
explaining increases in the money supply. Suppose the Chairman of the Federal Reserve ies
Intermediate Macroeconomics 220:321 Fall 2014
Homework 4
Instructor: Youngseok Park
(1) Assume that a countrys production function is Y = K 1/2 L1/2 . Assume an economy
with no technological progress and no population growth.
a. What is the per-worker pro
Intermediate Macroeconomics 220:321 Fall 2014
Homework 7
Instructor: Youngseok Park
(1) The advent of interest-earning checking accounts in the early 1980s led many households to keep a larger proportion of their wealth in checking accounts. Use the
aggre
Intermediate Macroeconomics 220:321 Fall 2014
Homework 8
Instructor: Youngseok Park
(1) Assume the following model of the economy, with the price level xed at 1.0:
Y =C +I +G
C = 0.8(Y T )
I = 800 20r
T = 1000
G = 1000
Ms
Md
=
= 0.4Y 40r
P
P
Ms = 1200
a.
Intermediate Macroeconomics 220:321 Fall 2014
Homework 9
Instructor: Youngseok Park
(1) The Phillips curve in Lowland takes the form of = 0.04 0.5(u 0.05), where
is the actual ination rate and u is the unemployment rate. The Phillips curve in
Highland ta
Intermediate Macroeconomics 220:321 Fall 2014
Midterm I Exam
Instructor: Youngseok Park
(1) (4 pts.) Busch Economy consumed 5 breads, 2 books, and 3 cars in 2013; it consumed
6 breads, 3 books, and 4 cars in 2014. In 2013, breads cost $3 each, books cost
4/30/2015
Chapter 5
INFLATION:
ITS CAUSES, EFFECTS, AND SOCIAL COSTS
WUKUANG CUN
Outline
° The quantity equation and the quantity theory of
money
- Inflation and Interest Rates
- The (general) money demand function 4/30/2015
Motivation
- In Chapter 3: w
5/2/2015
Chapter 10
INTRODUCTION TO ECONOMIC FLUCTUATIONS
WU KUANG CUN
Outline
- AD-AS model
(Using Quantitative Theory of Money)
° Shocks Aggregate Demand
The aggregate demand curve shows the relationship
between the price level and the quantity of o
CHAPTER 16
FISCAL POLICY AND THE
GOVERNMENT BUDGET
Intermediate Macroeconomics, Fall 2016
Zheng Zhao
Outline of Chapter 16
1. Overview of government budget, deficit, and debt
2. Fiscal policy: A closer look
the general equilibrium expenditure multiplier
CHAPTER 17
EXCHANGE RATES
AND
INTERNATIONAL ECONOMIC POLICY
Intermediate Macroeconomics, Fall 2016
Zheng Zhao
Outline of Chapter 17
1. Nominal exchange rates
2. Real exchange rates
3. Exchange rates in the long run
4. Exchange rates in the short run
supp
ECON 321:11
INTERMEDIATE MACROECONOMICS
Zheng Zhao
Fall 2016
Plan for today
Go over syllabus, course structure
please read syllabus carefully
First lecture
why study macroeconomics?
objectives of this course
start first topic: measuring economic activit
CHAPTER 6
ECONOMIC GROWTH: THE SOLOW MODEL
Intermediate Macroeconomics, Fall 2016
Zheng Zhao
The Solow Model
The Solow model
Start with the aggregate production function:
= 1
t
subscript = time
Assume (for now):
is constant (= )
is constant (= )
No go
CHAPTER 2
MEASURING MACROECONOMIC DATA
Intermediate Macroeconomics, Fall 2016
Zheng Zhao
Plan
Some key topics from Chapter 2
measuring
gross domestic product (gdp)
measuring
inflation
Will not discuss in class the measurement of:
unemployment
interest