Semester 2, 2012
ECON204
Macroeconomic Analysis
Tutorial 2, Week 4 Questions
1. Consider the following IS-LM model:
C = 200 + .25YD
I = 150 + .25Y - 1000i
G = 250
T = 200
(M/P)d = 2Y - 8,000i
i = i0 = 0.05
a. Derive the IS relation. (Hint: You want an equ
ECON204 MACROECONOMIC ANALYSIS, SESSION 1, 2015
Tutorial 2 for Week 4 Answers
1. Solving the IS-LM model:
C = 2000 + .25YD
I = 1500 + .25Y - 1000i
G = 2500
T = 2000
(M/P)d = Y(1-0.5i)
i = i0 = 0.02 (=2%)
a. Derive the IS relation. (Hint: You want an equat
ECON204 MACROECONOMIC ANALYSIS, SESSION 1, 2015
Tutorial 2 for Week 4 Answers
2. The liquidity trap
a) Suppose the interest rate on bonds was negative. Would people want to hold
bonds or to hold money? Explain.
Answer:
The interest rate represents the opp
ECON204
Macroeconomic Analysis
Semester 1, 2012
Department of Economics
ECON204 Macroeconomic Analysis
Year and Semester: 2012, Semester 1
Unit convenor:
Fatemeh NAZIFI
Prerequisites: (Admission to BEc or BCom or BAppFin or BActStud or BCom-ActStud or
BCo
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2015
Tutorial 1 for Week 3 on Topics 1/2
(Week beginning Monday 9th March 2015)
1. Suppose that the economy is characterized by the following behavioural equations:
C = 180 + 0.6 YD
I = 230
G = 110
T = 100 + 0.1
Semester 2, 2012
ECON204
Macroeconomic Analysis
Tutorial 11, Week 13
Answers
1. Country A has trade surplus and its output is below the natural level. The
policymakers goals are the output equal to its natural level and the balanced trade.
Given that the
ECON204 Tutorial 2
1. Consider the following IS-LM model:
C
= 200 + .25YD
I
= 150 + .25Y - 1000i
G
= 250
T
= 200
(M/P)d = 2Y - 8,000i
i = i0 = 0.05
a. Derive the IS relation. (Hint: You want an equation with Y on the left side, all else on the
right.)
b.
ECON204 MACROECONOMIC ANALYSIS, SESSION 1, 2015
Tutorial 2 for Week 4 Answers
3. Consumer confidence, monetary and fiscal policy
Assume that consumption is described by a linear function C = c0 +c1YD.
Using IS-LM framework, analyze the effects of an decre
Semester 2, 2012
ECON204
Macroeconomic Analysis
Tutorial 4, Week 6
Questions
1. Consider the following model of the economy:
Wages are determined by the following equation W = Pe (2.5 - 10u).
Price is determined by the following equation P=2W
Production f
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2015
Tutorial 3 for Week 5
Question 3
Some medium-run unemployment drivers
How will the real wage and the natural rate of unemployment change in the following
cases?
a. A new law is introduced making it easier to
ECON204 MACROECONOMIC ANALYSIS; SESSION 2, 2016
Tutorial 3 for Week 5 on Topic 3
(Week beginning Monday 29 August 2016)
Group Presentations at your weekly tutorial
The group presentations, as well as your attendance and engagement at these tutorials
will
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2015
Tutorial 3 for Week 5
Question 1
Markups
Suppose that the firms markup over costs is 20%. The (medium-run) wage-setting
equation is W=P(1-u)3z
where u is the unemployment rate, W is the nominal wage, P is th
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2016
Tutorial 4 for Week 6 on Topic 4
(Week beginning Monday 4 April)
Group Presentations at your weekly tutorial
The group presentations, as well as your attendance and engagement at these tutorials will
account
ECON204 MACROECONOMIC ANALYSIS, SESSION 1, 2016
1. Solving the IS-LM model:
C = 2000 + .25YD
I = 1500 + .25Y - 1000i
G = 2500
T = 2000
(M/P)d = Y(1-0.5i)
i = i0 = 0.02
a. Derive the IS relation. (Hint: You want an equation with Y on the left side, all els
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2016
Tutorial 3 for Week 5
Question 3
Some medium-run unemployment drivers
How will the real wage and the natural rate of unemployment change in the following cases?
a. A new law is introduced making it harder to
Semester 2, 2012
ECON204
Macroeconomic Analysis
Tutorial 8, Week 10
1.The present value of an infinite stream of dollar payments of $z (that starts next year) is
$z/i when the nominal interest rate, i, is constant. This formula gives the price of a consol
Semester 2, 2012
ECON204
Macroeconomic Analysis
Tutorial 7, Week 9
1. Suppose
that
the
economys
production
function
is
Y=K0.5(AN) 0.5
and that the saving rate (s) is equal to 16% and that the rate of depreciation () is equal to 10%.
Further, suppos
Semester 2, 2012
ECON204 Macroeconomic Analysis
Tutorial 5, Week 7,
Questions
1. Supply shocks and the medium run.
Using the AS AD model with an interest rate rule, show the effects of an increase in
unemployment benefits on the position of the AD and AS
Semester 2, 2012
ECON204
Macroeconomic Analysis
Tutorial 3, Week 5
1. Suppose that the firms markup over costs is 10%. The (medium-run) wage-setting
equation is
, where u is the unemployment rate.
a. What is the real wage as determined by price-setting eq
Microeconomics, 4e (Perloff)
Chapter 11 Monopoly
11.1 Monopoly Profit Maximization
1) For a monopoly, marginal revenue is less than price because
A) the firm is a price taker.
B) the firm must lower price if it wishes to sell more output.
C) the firm can
Chapter 4 Questions
1. Explain why you would be more or less willing to buy a share of Polaroid stock in
the following situations:
a. Your wealth falls. Less willing because your wealth falls
b. You expect it to appreciate in value. More because its relat
Exam
Name_
MULTIPLE CHOICE. Choose the one alternative that best
completes the statement or answers the question.
1
Which of the following statements about the nominal interest rate (i) is
correct?
1)
_
A)
The nominal
inflation.
B)
The nominal
C)
The nomi
a)
i=2
M d=$ 80 trn(0.350.5 0. 2)
d
M =$ 27.2 trn
i=3
M d=$ 80 trn(0.350.5 0. 3)
d
M =$ 2 6.8 trn
b) Interest rates have an inverse relationship to money demand, meaning when interest
rates rise, money demand decreases, and vice versa.
c) $Y is reduced by
Question 2
Group 2
Question assumptions
2. MONEY MARKET AND THE INTEREST
RATE
Suppose that aggregate wealth (made up
of money and bonds only) is fixed at
$100trn and that aggregate yearly income
is $80trn ($Y). Also, suppose that the
money demand function
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2016
Tutorial 5 for Week 7 on Topics 5 and 6
(Week beginning Monday 25 April)
Group Presentations at your weekly tutorial
The group presentations, as well as your attendance and engagement at these tutorials
will
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2015
Tutorial 1 for Week 3 on Topics 1/2
(Week beginning Monday 9th March 2015)
2. Suppose that aggregate wealth is $100trn and that aggregate yearly income is $80trn
($Y). Also, suppose that the money demand fun
ECON204 MACROECONOMIC ANALYSIS; SESSION 1, 2015
Tutorial 1 for Week 3 on Topics 1/2
(Week beginning Monday 9th March 2015)
3. Consider an economy with a banking sector. Money demand is given by
Md = $Y(0.35- i) where $Y is $80trn. Suppose that people desi
Exam
Name_
MULTIPLE CHOICE. Choose the one alternative that best
completes the statement or answers the question.
1
Which of the following will cause a reduction in output per worker in the
long run run?
1)
_
A)
an increase in the number of workers
B)
cap
Exam
Name_
MULTIPLE CHOICE. Choose the one alternative that best
completes the statement or answers the question.
Use the information below to answer the following questions:
(1) the rate of depreciation is 12% per year,
(2) the population growth rate is