1. Assume that a country's production function is Y = AK^0.2L^0.8. Population grows at 4 percent and capital depreciates at 2 percent per year. Technology grows at 1 percent a year. Capital is paid its marginal product. A=100 and savings is 20%.

a) What is the steady-state level of capital per effective worker?

b) At the steady-state what is the marginal product of capital?

c) At the steady-state what are the income per effective worker, consumption per effective worker, and investment per effective worker?

14. Betty consumes leisure and food and both are normal goods. a. Show graphically what would happen to the number of hours that Betty will work if she sees an increase non-labor income. b. Show with a graph and explain how Betty’s hours worked can decrease if she sees an increase in wages.

Consider two countries, Violet (Home) and Pink (Foreign), which can produce apples and lemonade. There is only one factor of production (labor). In order to produce a gallon of lemonade, Violet workers need 5 hours, while Pink workers need 10 hours. In an hour, Violet workers can produce 6 pounds of apples, while Pink workers can produce only 2 pounds of apples. Markets are perfectly competitive. Violet’s labor endowment is

L = 60,000 hours, while Pink’s labor endowment is L*= 90,000 hours.

a) What are the unit labor requirements for each product (apples and lemonade) in each country?

b) What is the opportunity cost of a gallon of lemonade in terms of pounds of apples in Violet? And in Pink?

c) What country has a comparative advantage in which good and why?

d) Draw the production possibility frontiers for Violet and Pink, with lemonade on the horizontal axis. What is the slope in Violet? And in Pink?

e) Draw the world relative supply, with the relative price of lemonade in terms of apples on the vertical axis, and the relative supply curve on the horizontal axis

f) Draw a world relative demand curve, crossing the relative supply curve at a point such that the relative price of lemonade in terms of apples is 20 pounds of apples for one gallon of lemonade. What good (or goods) will Violet produce at this price? What good (or goods) will Pink produce at this price?

g) Draw the consumption possibility frontiers for Violet and Pink (in two separate graphs) when there is international trade and the relative price of lemonade is 20 pounds of apples (as in the question above). Are there gains from trade for Violet? Why or why not? And for Pink? Why or why not?

Consider the following macroeconomy. All amounts are in millions (m.) of $; T=net taxes, which are fixed:

C = 750 + .8 Y_D

                                                            I = 1200

                                                            G = 250

                                                            T = 150

                a. This country’s Parliament passes legislation to have a balanced-budget amendment. What will be the value

             of this country’s balanced-budget multiplier (BBM)? Explain. Calculate the changes in the following variables if

             this country’s Parliament increases its G to $550 m: the GBD (govt budget deficit); eqm Y; and (net) taxes, T?    

             Show what this G increase does to the Z-Y space graph.

                b. What is meant by the “Paradox of Thrift” (POT), aka the Paradox of Saving? Why is it a paradox? Go back to the original eqm of part a. Now prove using multiplier analysis that the POT holds in this economy if c_o falls by $200 m. (ceteris paribus, cet. par.) by either calculating S private (S^p) at the initial eqm Y and then calculate S^p again after the attempt to increase S^p OR prove that the POT occurs using the appropriate math. Show what     happens (cet. par.) using the Z-Y space graph.

What are some of the criteria for forecast evaluation? What is Theil’s statistic?

In 2-3 paragraphs, respond to the following - Do you think that minimum wage laws affect overall poverty? Explain.

4. firms that make direct for foreign investment must evaluate such opportunities requiring capital investment very differently from the methods used to evaluate domestics investments. Describes theses differences from both a capital budgeting and country risk perspective.

Using Keynesian analysis, suppose the economy of Morrisville can be described by the following (all amounts are in millions of dollars):

Ca = 15 + .8(Y - 25)

Ia = 25

Ga = 25

X-M = 5

(a) The Marginal Propensity to Consume is .8. Explain IN WORDS what this means.

(b) In this case, with the MPC = .8, what is the value of the multiplier?

(c) Solve for the level of equilibrium income. In words, what does equilibrium in this context mean?

(d) Suppose the full employment or potential level of income is 50 more than your equilibrium calculation in part C). How large of increase in government spending is necessary to reach full employment? How large of tax decrease? Why do they differ?

In order for integration with other physicians to be successful, what person is needed to arrange the financing of capital needs and to provide administrative leadership?

A. Executive physician

B. Physician liaison

C. Managing physician

D. Physician activist

How would you characterize the major international trade flows unfolding in today’s global economy???

western civilization

identify in 50 to 75 words four specific ideas that make up the political ideology of Fascism, in the years between the World Wars.

1. Dollar stores like Dollar General do not pay customers’ transportation costs. Nonetheless, such stores have the incentive to minimize customers’ transportation costs. Why?

1 What is the effect if economic development in Malaysia?
Five objective neede?

2 What is the effect if economic development in Malaysia in education, economy , health , employment and culture?

3 What is your expectations about malaysia economy and the way you see it?

Scenario: Soybeans are produced in many countries of the world, including Brazil. Consider the market for soybeans in Brazil. Assume that the world price is below the domestic equilibrium price.

a. In a graph, show how large the amount of imported soybeans is (no numerical answer required). Also, show the area on the graph that represents revenue that Brazil soybean farmers receive.

b. Now let’s consider the effect of drought. On a new graph, show what happens to the total revenue Brazil soybean farmers receive when a drought occurs in Brazil compared to part A

c. Explain your answer to part b) in words

d. Using a new graph, show what happens to the total revenue that soybean farmers receive in case of drought in all soybeans producing countries except Brazil

e. Explain your answer to part D in words

Now the scenario changed: the effect of a change in tastes. Assume that the world price is below the domestic equilibrium price and that soybean-based bread suddenly becomes more popular among Brazilian consumers.

f. Compared to your original graph in part A, show what happens to consumer surplus from this change in tastes

g. Explain your answer into part F in words

h. Compared to your original graph from part A, show what happens to producer surplus and imports from this change in tastes.

i. Explain your answer to part H in words

1. The company accountant is uncertain which of three depreciation methods the firm should use for welding equipment that costs $200,000, and has a zero salvage value at the end of a 10-year depreciable life. Compute the depreciation schedule for the welding equipment using the methods listed:
   1. Straight line
   2. Double declining balance
   3. Sum-of-years’ –digits

      Based on your analysis, which depreciation method is most profitable for the firm?