CHAPTER 18
TRUE/FALSE QUESTIONS
(F)
1.
Life insurance companies provide protection against death.
(T)
2.
Life insurance companies are the oldest financial intermediary in the United
States.
(T)
3.
The assets of life insurance companies are not as marketab
CHAPTER 6
TRUE/FALSE QUESTIONS
1. (T)
If interest rates are expected to increase in the future, one would expect to see an upward
sloping yield curve.
2. (F)
A descending yield curve forecasts higher short-term rates in the future.
3. (F)
Expected lower r
CHAPTER 16
TRUE/FALSE QUESTIONS
(F)
1.
Bank failures are now treated as a remote contingency at best.
(T)
2.
Regional and industry recessions were and still are a major cause of bank
failures.
(T)
3.
The Comptroller of the Currency is the oldest bank regu
CHAPTER 13
TRUE-FALSE QUESTIONS
(F)
1.
Banks which assume higher risk will always earn higher returns.
(F)
2.
Banks operate under the same regulatory structure as any other financial
services firms.
(F)
3.
(T)
4.
Savings deposits are a larger percent of f
CHAPTER 10
TRUE/FALSE QUESTIONS
1. (T) The Dow Jones Industrial Average is a price-weighted index.
2. (F) The NASDAQ is a stock exchange.
3. (F) The secondary market for capital market securities is important because it provides funds
directly to deficit
CHAPTER 8
TRUE/FALSE QUESTIONS
1. (T) Capital market securities are used to finance real capital investments.
2. (F) Capital market securities are more liquid than money market securities.
3. (T) Money market securities are all debt securities, while capi
Intermediate Macroeconomics
Week 4 Tutorial
Question 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
CHAPTER 9
Applying the Competitive Model
CHAPTER OUTLINE
9.1 Consumer Welfare
Measuring Consumer Welfare Using a Demand Curve
Effect of a Price Change on Consumer Surplus
9.2 Producer Welfare
Measuring Producer Surplus Using a Supply Curve
Using Producer
Heteroskedasticity
Definition of Heteroskedasticity
One of the classical regression assumptions is:
SR3: var (ei ) = 2 for i = 1, ., N (homoskedasticity).
If this assumption is not satisfied by a regression model, then
heteroskedasticity exists, i.e.
var
Random Regressors
The Classical Regression Assumptions
SR1: yi = 1 + 2 xi + ei for i = 1, ., N
SR2: E (ei ) = 0 for i = 1, ., N
SR3: var (ei ) = 2 for i = 1, ., N
SR4: cov (ei , ej ) = 0 for i = 1, ., N, j = 1, ., N and i 6= j
SR5: The variable xi is not
Intermediate Macroeconomics
Week 5 Tutorial3
Team 3
1. (a). What is the real wage as determined by pr
ice-setting equation?
w= p (1-u) so we get
P= (1+u)w
w/p =1/(1+u) = 1/1.1 = 0.091
b. What is the natural rate of unemployment?
(1-u)= 0.91
So Un =9%
c.
CHAPTER 15
TRUE-FALSE QUESTIONS
1. (T) IBFs may be established by a U. S.-chartered depository institution, a U.S. branch or agency
of a foreign bank, or a U. S. office of an Edge Act Corporation.
2. (F) The Edge Act of 1919 permitted U.S. banks to create
CHAPTER 14
TRUE/FALSE QUESTIONS
(F)
1.
Banks need more liquidity than other businesses because of their large proportion of
short-term assets.
(T)
2.
Banks have lower capital ratios than industrial firms because bank assets are less risky.
(F)
3.
Liabilit
CHAPTER 20
TRUE/FALSE QUESTIONS
1. (T) Balanced funds generate higher proportion of income than growth and income funds and are
less volatile.
2. (T) Market arbitrage by hedge funds is the simultaneous buying and selling of a security or
derivative of the
CHAPTER 17
TRUE/FALSE QUESTIONS
(T)
1.
Mutual institutions are owned by their depositors.
(F)
2.
S&Ls were originally established to take advantage of a tax loophole.
(F)
3.
Federal Home Loan Banks are among the regulators of savings institutions.
(T)
4.
ECON633
Tutorial 6,
1. Suppose that the production function is given by
Y 0.5 K N
a. Derive the steady state levels of capital per worker and output per worker in terms of the saving rate (s)
and the depreciation rate ().
A.
Y 0.5 K N
As the production fu
2. Spending shocks and the medium run
Using the AS-AD model where the central bank uses an interest rate rule with
a price level target show the effects of an increase in consumer confidence on
the position of the AD, AS, IS, and LM curves in the medium r
Intermediate Macroeconomics
Week 3 Tutorial
Question 1
Suppose that the economy is characterized by
the following behavioral equations:
C = 160 + 0.6 YD
I = 210
G = 150
T = 100 + 0.1 Y
Solve for:
a. equilibrium GDP (Y)
Y=C+I+G
=160+0.6Yd+210+150
=5
Intermediate Macroeconomics
Week 4 Tutorial2
Team 3
Question 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
Point Estimation
Let
Y1 , Y2 , .YN be a sequence of identically distributed
random variables.
be a parameter of the PDF of Yi .
Then a point estimator of the parameter is a function of
Y1 , Y2 , .YN , that is designed to be `close to' .
1/7
Point Estimat
Dummy Variables
1 / 17
A Review of Binary Random Variables
Consider a population of size N. Nc elements of the
population have a characteristic of interest.
Let p =
Nc
N .
Consider the experiment of randomly selecting 1 element from
the population.
P(t
Dynamics
Time series data are data for which the variables are
measured for a sequence of successive time periods.
A time series regression is a regression model for time series
data. e.g.
yt = 1 + 2 xt + et
t = 1, ., T
Time series regression models may i
TOPIC 2
The IS-LM model: Short-run goods
market and money market
equilibrium; monetary policy
& fiscal policy; the policy mix
comparing a money supply rule with
an interest rate rule.
PowerPoint to accompany:
3-1
The Composition of
Australian GDP, 2011
P
Tutorial 7
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, suppose that the number of workers grows at 2% per year and that the
Semester 2, 2014
ECON633
Tutorial 6,
1. Suppose that the production function is given by
a. Derive the steady state levels of capital per worker and output per worker in terms of the saving
rate (s) and the depreciation rate ().
b. Derive the equation for
Tutorial 2, Week 4
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.