1. Determine if the following statements are correct and then explain briefly.

a. Policymakers in a closed economy could promote economic growth by encouraging saving.

b. When the government removes the minimum wage law, natural unemployment will fall.

c. If inflation is lower than expected, creditors gain at the expense of debtors.

d. Increase unemployment benefit payment to the unemployed will increase unemployment.

Which sets of data can be used to identify business cycles? Select all that apply.
Choose one or more:A.real GDP data

B.salary or wage data

C.unemployment rate data

Write at least one paragraph with a minimum of 100 words on the Tang Dynasty period in China and why that period was considered the “Flowering of the Chinese Civilization.” Include a look at the inventions, the literature (poetry) and interaction with other cultures in your discussion.

5. In recent years, about twenty states have passed so-called medical marijuana laws. Typically, these laws permit individuals to lawfully purchase marijuana from licensed stores, providing they have a letter from their doctor recommending its uses. In a number of these states, the price of medical marijuana is observed to be higher than that of the pot sold illegally just down the street. Use the reasoning in this chapter to explain (a) why people would be willing to pay a higher price for the medical marijuana, and (b) why it might be misleading to compare the observed price of the medical variety with the observed price of the illegal weed.

How does the trade regime present opportunities and challenges for development?

Please write clear definitions of the following legal terms.

1. Consideration
2. Contractual Capacity
3. Duress
4. Fixture

The demand for video recorders has been estimated to be QV = 145 - 3.2Pv +7M - .95Pf -39PM, where Qv is the quantity of video recorders, PF denotes the price of video recorder film, Pm is the price of attending a movie, PV is the price of video recorders, and M is income. Based on the estimated demand equation we can conclude:

A. Video recorders are normal goods B. Video recorder are normal goods and demand for video recorders is inelastic C. The demand for video recorders is inelastic D. Video recorders are normal goods and video recorder film is a complement for video recorders A and C A and B

Question 1: Rebel without a cause

Two drivers speed head-on toward each other and a collision is bound to occur unless one of them deviates at the last minute. If both deviate, everything is okay (they both win 1). If one deviates and the other does not, then it is a great success for the driver with iron nerves (he wins 2) and a great disgrace for the deviating driver (he loses 1). If both drivers have iron nerves, disaster strikes (both lose 2).

1. Write down the payoff matrix of this game.

2. Briefly (1-2 sentences) define the notion of Nash Equilibrium.

3. What are the Nash equilibria of this game?

Differentiate between absolute poverty and relative poverty? Is absolute poverty concept is relevant to Pakistan? Explain how absolute poverty can be eliminated from LDC?

The inverse demand equation for the output of a monopolist is P = 50 − 2Q. The monopolist's total cost equation is C(Q) = 100 + 2Q + Q2. What is the deadweight loss at the profit-maximizing output and price?

• $48

• $64

• $16

• $32

• None of the options.

1a. Graph the long run position of a firm in monopolistic competition.

1b. Graph the typical monopolistic long run situation.

1c. Compare the two graphs and explain how they are similar.

Federal welfare programs expanded dramatically during President Johnson’s War on Poverty, continuing a prominent government role in welfare since Franklin D. Roosevelt’s New Deal. In 1997, the Aid to Families with Dependent Children (AFDC) was replaced by Temporary Assistance for Needy Families (TANF). Identify the major changes from AFDC to TANF. How does the implementation of block grants introduce considerable variation among the states? Explain the relative advantages and disadvantages of the transition from AFDC to TANF.

3. Suppose that a closed economy could be described by the following set of equations: Production Function: Y = 120K1/3 L2/3

̅̅ Factors of production: K=125; L=1000

̅̅ Government Behavior: G= 3000; T = 2500

Consumption Behavior: C = 400 + 0.8(Y –T)
Investment Behavior: I = 16500 – 1000r
a. Calculate the equilibrium level of output (Y)
b. Prove that the production function has the property of constant returns to scale.

c. Calculate the marginal product of labor (MPL)

d) Calculate the equilibrium levels of the following variables

(i) Consumption (C)

(ii) Private Savings

(iii) Public Savings

(iv) National Savings (S)

(v) real interest rate (r)

explain how the Central Bank of Venezuela could adjust its foreign exchange reserves to try to push the black-market bolivar-dollar exchange rate closer to the official fixed exchange rate?