Intermediate Macroeconomics 220:321 Spring 2015
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 cos
Intermediate Macroeconomics 220:321 Spring 2015
Final Exam
Instructor: Youngseok Park
Instruction: You have 120 minutes. Read each question thoroughly before you start solving
it. Write legibly please. You can use a calculator but no books/notes/other ele
Intermediate Macroeconomics 220:321 Spring 2015
Homework 2
Instructor: Youngseok Park
(1) Economists occasionally speak of helicopter money as a shorthand approach to explaining
increases in the money supply. Suppose the Chairman of the Federal Reserve f
Intermediate Macroeconomics 220:321 Spring 2015
Final Exam
Instructor: Youngseok Park
Instruction: You have 120 minutes. Read each question thoroughly before you start solving
it. Write legibly please. You can use a calculator but no books/notes/other ele
Intermediate Macroeconomics
DongWhan Ko
Raising Americas Wages
In every Introduction to Economics class, students are taught the basics of price controls
such as price floors and price ceilings. One of the most basic examples of a price floor given
invol
Intermediate Macroeconomics 220:321 Spring 2015
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 inflation rate and u is the unemployment rate. The Phillips curve in Highland
4. (go/(J [M {gag5):}
,\
:v"J")'>*fr!<"#15) M if Err'2 if
.s
(I.
:
'"' r? _
J [r * '* W" a: ag.4 .511? if ,.7_.;";".~
{j 3:1: IT M, Jig,
if: / f
5 1
._ ;_ I I I
"E, L/"QJ:_IN:{?E.
ah 6,} 7" a}
fi .
g _\_' f ti ~ 5:15;}
i,
\_
~ Km rim

l. at. Beth countries have a natural rate of unemployment of 5 percent, and the slope of
the Phillips curve is the same in both countries. The Phillips curves in both
countries indicate a shortrun tradeoff between more ination and less
unemployment.
b. T
In the short run, output decreases, while the price level remains unchanged. In the long
run, prices decrease and output returns to the fullemployment level.
LRJlS
In the short iun, output decreases, while the pnce level increases. In the long run, pric
Intermediate Macroeconomics
DongWhan Ko
Unconventional Monetary Policy
As the central bank of the United States, the Federal Reserve conducts monetary policy in
order to maintain its dual mandate: high employment and price stability. The Fed generally ha
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by CamScanner
Scanned by Ca
Intermediate Macroeconomics 220:321 Spring 2015
Homework 6
Instructor: Youngseok Park
(1) Assume that population grows at rate of n and the rate of depreciation of capital is ,
and there is no technological progress. k = sf(k)( +n)k shows the change in
ca
Chapter1
THE SCIENCE OFMACROECONOMICS
Instructor Youngseok Park
M OTIVATIO
REAL GDP
N
M OTIVATION
INFLATION RATE
M OTIVATION
UNEMPLOYMENT RATE
M OTIVATION
THEORYAS MODEL BUILDING
 Endogenous variables: What a model tries to explain.
 Exogenous variables
Intermediate Macroeconomics 220:321 Spring 2015
Homework 1
Instructor: Youngseok Park
(1) Assume that the production function is given by Y = AK0.5L0.5, where Y is GDP, K is capital
stock, and L is labor. The parameter A is equal to 10. Assume also that c
b,
_.a
wlir'ul«ybriggllifjj (KL/5140?"? i POT. Vléf
Y: 5,000 1001.
Y= 3,000 + 1001'.
In the Shortrun equilibrium, Y: 4,000; r = 10; Y T: 3,000; C : 2,400; I : 600; private
saving is 600; public saving is 0; and national saving is 600.
Y increases
A Note on Eulers Theorem
Econ 321, Instructor: Youngseok Park
February 5, 2015
If a production funciton F(K,L) shows constant returns to scale and it follows with
and
, then Y = FLL + FKK.
Proof By definition it is true for constant returns to scale produ
Intermediate Macroeconomics 220:321 Spring 2015
Homework 5
Instructor: Youngseok Park
(1) An economy described by the Solow growth model has the following production function:
.
a. Solve for the steadystate value of y as a function of s, n, g, and .
b. A
P
P] "'~ I    5mm
I
I
P 2.
Pa, d~a=a=% «muE mmmmmmmmmmm ~5P 4,53
t V #th
l "W: ,
Y1 YE 1
In the short run, output decreases, while the price level remains unchanged. In the long
run, prices decrease and output returns to the fullemployment level.
LRA
Intermediate Macroeconomics 220:321 Spring 2015
Homework 6
Instructor: Youngseok Park
(1) Assume that population grows at rate of n and the rate of depreciation of capital is
, and there is no technological progress. k = sf (k) ( + n)k shows the change in
Intermediate Macroeconomics 220:321 Spring 2015
Homework 7
Instructor: Youngseok Park
(1) The advent of interestearning checking accounts in the early 1980s led many households to keep a larger proportion of their wealth in checking accounts. Use the
agg
Intermediate Macroeconomics 220:321 Spring 2015
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
i.
a.
/ '
ail/lria/LQQJCTédQ 014M"? \ v 1061 V/<
Y: 5,000 1007*.
Y: 3,000 + 1007'.
In the shortrun equilibrium, Y: 4,000; r = 10; Y~ T: 3,000; C = 2,400; I = 600; private
saving is 600; public saving is 0; and national saving is 600.
Y increases by 50