Lecture14
Monetarypolicy
1
Two big questions to consider
1. To what extent is it prepared to put in
place required constraints on monetary
policy, to prevent a cruel circle of inflation
and high public expectations of inflation?
2.
The second big question
Lecture13
Fiscalpolicy
1
Government in the Economy
Nothing arouses as much controversy as
the role of government in the economy.
Government can affect the macroeconomy
through two policy channels: fiscal policy
and monetary policy.
Fiscal policy is the
Lecture12
Expendituremultipliers:
theKeynesianmodel
1
Keynesian Macroeconomics: Aggregate
Demand and the Multiplier Effect
John Maynard Keynes, The General Theory of Employment,
Interest and Money (1936)
Great Depression (1929-1938) shows possibility of
u
Lecture 10
Aggregate supply and aggregate
demand
Motivation
The Great Depression caused a rethinking
of the Classical Theory of the
macroeconomy. It could not explain:
Drop in output by 30% from 1929 to 1933
Rise in unemployment to 25%
In 1936, J.M. Keyne
Lecture8
MoneyandInflation
1
The Financial System
A financial system is an open
system that allows financial
resources to be transferred from
savers to borrowers.
The Financial System
According to Buchenrieder
(2002), a financial system includes
three mai
Lecture 7.2
Savings and Investments
Constructing the Budget Constraint
Income
Profits
Households may earn profitsan
excess of revenue over costsas
shareholders of the firms in the
economy.
Y= A F( Kd, Ld )
= PY (wLd+ RKd)
= P .A F( Kd, Ld ) ( wLd+ RKd)
Lecture 7.1
Markets
Markets in the Macroeconomy
We simplify by assuming that
households perform all the functions in
the economy
They operate a production technology
and use labor, L, and capital, K, to
produce goods, Y, through the
production function.
Y
Lecture #10
Linear regression (Ch.10)
The linear regression is a problem of relating the
mean value of a single r.v. Y to a single independent
variable x using a linear relationship.
Suppose we have a realization ( y 1 , y 2 , , y n ) of a
sample Y = cfw_
Lecture # 9
Correlation
Let X and Y be two not necessarily
independent random variables. Their joint
probability distribution function is
F ( x, y ) = P ( X x, Y x ) .
If X and Y are discrete, then the joint
probability distribution (j.p.d.) is
P( X = x,
Lecture #8
Tests for two samples (sec.9.1)
Suppose you would like to compare the mean price of a
home in one state with that in another.
If you have got two independent random samples of
size n 30 (large samples), you may to use the
following.
Let 1 be un
Lecture #7
Hypotheses testing
Let a statistical model be given:
X n = cfw_ X1 , ., X n and F( x, ).
Different hypotheses may be posed about this
model.
Examples
cfw_ x1 , ., x n of X n
1) Does
a
realization
H:
contradict or not to a hypotheses
X i ~ f (
Lecture #6.
Sampling distributions
The arithmetic mean
1n
X + X 2 + + Xn
X = Xi = 1
n i =1
n
.
If EX i = , then EX = x = .
2
Var X = E( X E X) =
,
n
2
where
2 = E( X i EX i ) 2 ,
i = 1, n
This is due to the independence of X i -s and due to
the fact that
Lecture #5
Continuous r.v.
Suppose a r.v. X takes values from [0,1] with
equal probabilities. Simple events points of
[0,1] . = [0,1] . contains points.
Let an events A occurs if X = a, 0 a 1.
1
P( X = a ) = = 0!
Thus, only events like X [a, b], a 0, b 1,
Lecture # 4.
Definition 11 (p.210)
The mean or expected value of a discrete r. v. X
is
= EX = kP( X = k )
kK
Definition 12 (p.212)
The variance of a discrete r. v. X is
2 = E( X ) 2 = (k ) 2 P( X = k )
kK
Examples of discrete probability distributions
W
Lecture #_3
Elements of probability
Definition 1 (p.147)
A simple event is an outcome of an experiment that
can not be decomposed into a simpler outcome
Example 1. Tossing 1 coin
cfw_ 1 , 2
1 head (H)
2 tail (T)
Example 2. Tossing 3 coins at once
cfw_ 1
Lecture # 2
1) Histogram
Definition 1
The class frequency f i for a given class is equal
to the total number of measurements that fall
in that class.
Definition 2
The class relative frequency for a given class is
equal to the proportion f i / n for the to
Lecture #1.
Problems of probability theory
What is the probability?
Consider for example the tossing of a coin.
Simplest case tossing of one coin.
Two elementary events are possible:
A 1 head
A 2 tail
Frequency f is the number of events, say A 1 ,
from th
Industrialism
1st industrial revolution
The idea of modern technology
(science and the mastery over nature)
3 principles:
Substitution of machine power for
manpower/animal power
Substitution of machines for human skill
Substitution of mineral for vegetabl
KIMEP
IFRS
Summer 2012
In Groups of max 3 people, please write your final essay-project on
one of the topics below
1. Why are IFRS so strong in using Fair Value instead of Historical Cost for Valuations of
Property, Plant and Equipment?
2. Convergence wit
Homeworks should be submitted at the beginning of the class:
1.
Part A:
Homework 1: Due date: 08.09.2011
Corn
(pounds per
month)
1. Janes Islands production possibilities are given in the
table. What are Janes opportunity costs of producing corn
and cloth
Homeworks should be submitted at the beginning of the class:
1.
Homework 1: Due date: February 3, 2012
Part A:
Corn
(pounds per
month)
1. Janes Islands production possibilities are given in the
table. What are Janes opportunity costs of producing corn
and
Homework
Obviously this article is very specialized and very difficult to read. But dont worry, use
the reading strategies we discussed in class on Friday to find the answers to these
questions. Without these reading strategies you might find the question
Homework #1 Due May 23rd
Problem #1
You heard that there will be another tenge devaluation; this time by 35%. You
notice that Limpopo is offering a bid of 145 and an ask of 147.
A. What would be the new (after devaluation) exchange rates?
B. If you had 10
Homework #6
Macroeconomics
Surname:_ ID:_
Taks 1.
In the economy A a nominal interest rate is 20% a year and an inflation rate in 10% a year. In the
economy B these figures are respectively 100% and 85%. Which country has a higher real interest
rate? Use