Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
Review of AD/AS Model (Chapter 9)
Aggregate Demand Curve (AD Curve)  Shows the relationship between the aggregate
(nominal) price level and real aggregate output (GDP) demanded. The quantity equation, money
market equilibrium, can be employed to show the
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
Review of IS/LM Model (Chapters 10 & 11)
IS Curve
LM Curve
Ceteris paribus, the Investment Saving or IS
Curve shows all of the (Y,r) pairs that
support (lead to) equilibrium in the Goods and
Services market.
( i.e. YS = YD ] S = I )
Ceteris paribus, the L
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
Unemployment in the LR  (Ch6)
ECMB06 Summer 2012
Key Labour Market Definitions
Working Age Population (WAP) is the entire population
between the ages of 15 and death.
Canadian labour force statistics cover the entire
population 15 years old and up. So
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
Money, Prices & Inflation in the LR
(Ch4)
ECMB06 Summer 2012
Money
Refers to all assets, generally with a high degree of
liquidity, that can easily be used to settle transactions.
Three Main Functions of Money
1) Store of Value  provides a way to transfe
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
Ch 10  SOLUTIONS to Supplemental Notes and Exercises #1
1)
Keynesian Cross & the Construction of the IS Curve
a)
Suppose C0 = 100, C1 = 0.6, I0 = 500, I1 = 50, and T0 = G0 = 500. What is the planned
expenditure function? If r = 4 (percent) what is the re
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
ECMB06: Dynamics in the Very Longrun
A simple explanation for motivation
Ch3
 LR model & static equilibrium
Inputs & technology determine LR output
& 8  LR & very LR model dynamics
Inputs & technology determine LR & very LR output
Changes in inputs
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
ECMB06: Course Overview
Text:
Macroeconomics: Canadian Edition (4th or
3rd edition) By Mankiw & Scarth
Strengths: Well written, not too technical, math is
not too hard, short manageable chapters, good
ordering of material (LR and very LR dealt with
befo
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
Ch 10  Supplemental Notes and Exercises #1
1)
The Keynesian Cross  A simple model of SR income determination. Keynes postulated
that in the SR an economys aggregate (real) income was determined largely by the desire
to spend by households, firms, and th
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
ECM B06  FINAL Exam
Recommendations
2.5 hours in length 
Monday, August 13th (7
pm) in IC130
Office Hours (in IC284)
TBA
Same style as past exams: All shortanswer questions
Covers chapters 2 through 12 (Eleven chapters). The
majority of the exam will
Macroeconomic Theory and Policy: A Mathematical Approach
ECMB 06

Spring 2016
Purchasing Power Parity (PPP) Measuring Variables
Absolute PPP
This theory says (predicts) the real exchange rate is equal to one (unity or parity) in the longrun.
So
e P
1
Pf
Where = the real exchange rate
= # of units of foreign real GDP you can
ECMB12H3 Lec 01, 30, 60
Quantitative Methods in Economics II
Department of Management
University of Toronto at Scarborough
Winter 2012
Dr. Yu
Test 2
Date:
Friday March 16, 2012
Time allowed:
Two (2) hours
Aids allowed:
Calculator and one aid sheet (two 8.
ECMB12H3 Lec01, L30, L60
Quantitative Methods in Economics II
Department of Management
University of Toronto at Scarborough
Winter 2012
Dr. Yu
Test 1
Date:
Friday February 10, 2012
Time allowed:
Two (2) hours
Aids allowed:
Calculator and one aid sheet (tw
ECMB12H3F L30
Quantitative Methods in Economics II
Final Examination
Wednesday December 14, 2011
24 pm
Instructor: Victor Yu
Last Name (Print): Solution
First Name (Print):
Student Number:
Circle your section
Aids allowed:
L30 Wednesday
Deferred Exam
Calc
ECMB12H3 Lec30
Quantitative Methods in Economics II
Department of Management
University of Toronto at Scarborough
Fall 2011
Dr. Yu
Test 2
Date:
Monday November 21, 2011
Time allowed:
Two (2) hours
Aids allowed:
Calculator and one aid sheet (two 8.5x11 pag
ECMB12SL30 and L60 Quantitative Methods in Economics II
Division of Management and Economics
University of Toronto at Scarborough
Winter 2011
Dr. Yu
Final Examination
Date:
Saturday April 16, 2011
Time allowed:
Two (2) hours
Aids allowed:
Calculator and
ECMB12H3 Lec30 and Lec60
Quantitative Methods in Economics II
Department of Management
University of Toronto at Scarborough
January May 2011
Dr. Yu
Test 2
Date:
Saturday March 19, 2011, 911am
Time allowed:
Two (2) hours
Aids allowed:
Calculator
Notes:
Th
ECMB12H3 Lec30 and Lec60
Quantitative Methods in Economics II
Department of Management
University of Toronto at Scarborough
January May 2011
Dr. Yu
Test 1
Date:
Saturday February 12, 2011, 5:00 7:00 pm
Time allowed:
Two (2) hours
Aids allowed:
Calculator
ECMB12SL30 and L60 Quantitative Methods in Economics II
Division of Management and Economics
University of Toronto at Scarborough
Winter 2010
Dr. Yu
Final Examination
Date:
Wednesday April 21, 2010
Time allowed:
Two (2) hours
Aids allowed:
Calculator and
ECMB12H3 Lec30 and Lec60
Quantitative Methods in Economics II
Division of Management
University of Toronto at Scarborough
January May 2010
Dr. Yu
Test 1
Date:
Saturday February 6, 2010, 9:00 11:00 am
Time allowed:
Two (2) hours
Aids allowed:
Calculator an
ECMB12SL30 and L60 Quantitative Methods in Economics II
Division of Management and Economics
University of Toronto at Scarborough
Winter 2009
Dr. Yu
Final Examination
Date:
Saturday April 18, 2009
Time allowed:
Two (2) hours
Aids allowed:
Calculator, Reg
ECMB12S Section L30 and L60
Quantitative Methods in Economics II
Division of Management
University of Toronto at Scarborough
January 2009 May 2009
Dr. Yu
Test 2
Date:
Saturday March 21, 2009
Time allowed:
Two (2) hours
Aids allowed:
Calculator, regression
ECMB12H3 Lec30 and Lec60
Quantitative Methods in Economics II
Division of Management
University of Toronto at Scarborough
January May 2009
Dr. Yu
Test 1
Date:
Friday February 6, 2009, 3:00 5:00 pm
Time allowed:
Two (2) hours
Aids allowed:
Calculator and o
ECMB11H3 Sections L01, L30 and L60
Quantitative Methods in Economics I
Department of Management
University of Toronto at Scarborough
Fall 2011
Dr. Yu
Test 1
Date:
Monday October 17, 2011
Time allowed:
Two (2) hours
Aids allowed:
Calculator and one aid she
ECMB11H3 Quantitative Methods in Economics I
Sections L01 & L30, Summer 2011
Department of Management
University of Toronto at Scarborough
Dr. Yu
Final Examination
Date:
Saturday August 13, 2011
Time allowed:
Two (2) hours
Aids allowed:
Calculator and two
ECMB11H3 Sections L30 and L60
Quantitative Methods in Economics I
Department of Management
University of Toronto at Scarborough
Summer 2011
Dr. Yu
Test 2
Date:
Saturday July 23, 2011
Time allowed:
Two (2) hours
Aids allowed:
Calculator and one aid sheet (
ECMB11H3 Sections L01 and L30
Quantitative Methods in Economics I
Department of Management
University of Toronto at Scarborough
Summer 2011
Dr. Yu
Test 1
Date:
June 10, 2011 (Friday)
Time allowed:
Two (2) hours
Aids allowed:
Calculator and one aid sheet (