Econ 2152B-001 Lecture 9
Economic Growth: Malthus and Solow (Ch 7)
Instructor: Wenya Wang
University of Western Ontario
1 / 38
In This Lecture
Introduction of our class:
economic growth and business c
MACROECONOMICS
Week 5 Seminar Questions
2006
Questions for Review
1.
How do consumers save in the two-period model?
2.
By buying bonds
This period you save s, next period you get s(1+r)
What is the sl
If you find a mistake in these solutions, first check online to see if it has been fixed, then send me
an email.
1) When X is the sample mean taken from a Normal population distribution with known var
Lectures 6 and 7 practice problem solutions
Ch 4, problems 1, 2, 3 (NOTE: h=16), 4, and 7 (suppose income effects are same magnitude) (starting
page 126)
Answers:
Problem 1: show that it violates mono
Lecture 13 practice problems
SA1. Suppose the government decided to subsidize savings and tax borrowing. The savings
subsidy is t fraction of savings, and the borrowing tax is also t fraction of borro
Lecture 15 practice problems
SA1. Suppose the consumers utility function is
U= c + c' . The consumers discount factor is 0.5.
Part A: show that the consumers optimal consumption bundle is (8, 8) and t
Lecture 3 practice problem solutions
Ch 2 Problem 4a: Year 1 = 30,000; Year 2 = 50,700
Ch 2 Problem 4b: Base year: YR2 RGDP (YR1 base year) = 37,000; growth rate = 23.3%;
chain-weight growth rate = 23
Lecture 14 practice problems
SA1. Suppose the consumers utility function is
U= c + c' . The consumers discount factor is 0.5,
current-period endowment is 12, future-period endowment is 0, and the real
MACRO
VARIABLES &
COMOVEMENTS
Bohan Li
ECON 2152B-002 Lecture 3
Administrative item
Assignment is online
Please follow instructions! There are many of you
Please use cover sheet
Please put all an
MACRO
VARIABLES
Bohan Li
ECON 2152B-002 Lecture 2
Quick administrative note
New office hours:
Tuesdays, 3-4pm
Thursdays, 4-5pm
Top Hat: www.tophat.com
Course ID: 777954
The importance of data
and
Ricardian Equivalence and Credit
Market
Revisited
Ricardian Equivalence and Credit
Market
Explain the impact of a current tax
cut on the credit market and
equilibrium real interest rate
Sp represent
Econ 2152B-001 Lecture 1
Introduction to Macroeconomics (Ch 1)
Instructor: Wenya Wang
University of Western Ontario
1 / 18
What is Macroeconomics?
Macroeconomics: analysis of large economic questions
Explanation
These are some extra exercises, some of which were proposed during lectures. Doing them will help you
solidify your understanding of concepts covered in class. Exercises marked with a are
Question 1: Bias and Efciency
Two estimators for , the population mean of X, are given by:
1 = X + 2,
2 = X + , N (0, 10)
(a)
Compute the bias for both estimators. Which has the least bias?
(b)
Comput
1) When X is the sample mean taken from a Normal population distribution with known variance,
how can we write the sampling distribution of X? What is the corresponding (1 ) 100% confidence
interval f
Econ 2152B-001 Lecture 2
Measurement (Ch 2 & 3 )
Wenya Wang
University of Western Ontario
1 / 46
In this Lecture
Measurement of a macroeconomic variable:
starting point to understand how the economy w
Econ 2152B-001 Lecture 8
A Monetary Intertemporal Model:
Money, Banking, Prices and Monetary Policy (Ch 12)
Instructor: Wenya Wang
University of Western Ontario
1 / 33
In This Lecture
Recall in the pa
Econ 2152B-001 Lecture 3
One-Period Model: Consumer & Firm Behavior (Ch 4 )
Instructor: Wenya Wang
University of Western Ontario
1 / 39
In this Lecture
Individual (consumers or firms) decisions: withi
Econ 2152B-001 A Two-Period Model: Consumption,
Saving and Credit Markets (Ch 9)
Instructor: Wenya Wang
University of Western Ontario
1 / 37
In This Lecture
In Lecture 4, we discuss one-period Model:
Econ 2152B-001 Competitive Equilibrium in One-Period
Model (Ch 5)
Instructor: Wenya Wang
University of Western Ontario
1 / 33
In this Lecture
In Lecture 3, we:
C=w(h-l)+-T
described consumer behavior;
Econ 2152B-001 Lecture 7
A Real Intertemporal Model with Investment (Ch 11)
Instructor: Wenya Wang
University of Western Ontario
1 / 40
This Lecture
We have studied:
work-leisure choice in Lecture 4
.
Econ 2152B-001 Lecture 6
Credit Market Imperfection & Failure of Recardian
Equivalence (Ch 10)
Instructor: Wenya Wang
University of Western Ontario
1 / 23
In This Lecture
In Lecture 5, a perfect credi
Credit market uncertainty
Vertical ditance between Yd 1 and yd 2
represents the credit market default
premium. This is higher for borrowers
than the equilibrium rate so output ,
employment , investme
Ch 8 part 1
Two-Period Model
N consumers (not representative)
Live for two periods (current, future).
Receive endowment in each period (y, y).
Pay lump-sum tax in each period (t, t).
Decision: how muc
A TWO PERIOD MODEL
I. Description
Up to now all the action in our model economy has taken place during one period. It is
as if the economy exists for one period in time and then disappears.
Obviously
Government in the Two Period Model.
We will now place a government in our model.
There are a few preliminary points that we need to make.
1) All government decisions to use some of the production of o