1) Explain why we never say
“accept” the null hypothesis (but we rather say “fail to reject”
the null hypothesis).
2) State the requirements that must be
satisfied to test a hypothesis regarding a population mean with
either the population standard deviation know or unknown.
3) Explain two graphs/figures/plots
that you can use to assess whether the sample data is normally
distributed? Make sure to explain how to assess normality using
these graphs; that is, what to look for in...
(a) Explain why LM curve shift towards the right if demand for
money decreases (say due to decrease in uncertainty).
(b) Every point above the LM curve imply excess supply
of money and income will increase to bring the money market back
into equilibrium. True/false? Explain your answer.
Why is there growing inequality of wealth, and why should we be
concerned? What are the adverse consequences of growing
inequalities (as related to cash versus in-kind
transfers)?
In everyday language we say, “let me borrow money”, “she makes a
lot of money”, “she has a lot of money”.
How would you translate these statements into how economists use
the terms money, income and wealth?
Explain in depth what mortgage securitization is
Explain why we have money markets and their overall purpose
Explain quotes in the T bill secondary market. In big terms
Explain in your own words what a component unit is, and why such
component units are established. For a full answer, you need to
give the criteria for when an entity is considered a component
unit, and you must also give some reason why these component units
are set up to be legally separate from the related primary
government. .
Question 1:
(a) What do we mean when we say money is neutral?
(b) Bill Clinton believed in working with the Fed to use
Monetary Policy to help the economy grow while he was President in
the early 1990s. That is, he believed that money had real effects
(on output and the interest rate). Show that Bill Clinton was
right, and money is non-neutral in the short run. (Guide: Draw the
IS-LM graph only).
(c) Ronald Reagan believed that Monetary...