Q.1 Suppose that we have the following data:

A) What is the labor force participation rate, the employment to population ratio and the unemployment rate? Type in the formulas and the numerical answers.

B) Suppose that over the course of the month 370 employed people lost their job and 751 unemployed people found jobs. Estimate the job-finding rate and the separation rate.

C) Assuming that the bathtub model is correct, what is the long-run unemployment rate?

D) Suppose that advances in AI make reviewing resumes of job applicants easier for HR professionals and as result the job-finding rate goes up to 0.35. What do you think will happen to the separation rate? What is your qualitative prediction about the unemployment rate?

Research indicates that chemical industries located along a river discharge highly toxic effluents into the river in your country. This pollutes the river water and contaminates fisheries resources for which the industries do not compensate for the reduced quality of the river water and fisheries losses. If you are a high-ranking government official with an expertise in environmental economics, what different methods will you consider to apply to address the issue? Give an international example to show that the effluents are likely to threaten public health security.  

10 marks question. need proper explanation please

Does the Federal Reserve operate like an ordinary commercial bank? What is the Fed's job?

What is Varshney’s argument for why lower caste Hindus in India overall have fared better in the southern states compared to the northern states since independence?

Why has the US-China trade tensions escalated despite the WTO agreements?

What are the two main problems arise from the CPI bias. What are the four main ways in which the CPI is an upward-biased measure of the price level?

21. Typically, a country’s balance of payment identity is referred to as __________. A) National Saving - Domestic Investment = 0 B) Current Account + Financial Account + Capital Account + Statistical Discrepancy = 0 C) Current Account + Financial Account + National Saving + Statistical Discrepancy = 0 D) Net Exports + Net International Investment Income + Statistical Discrepancy = 0 22. A country sees a net international capital inflow if ____________________. A. its current account is in deficit B. its financial account is in surplus C. the country is a net international borrower D. all of the above 23. If a country runs a financial account surplus, it means that __________________________. A) this country’s asset imports exceed its asset exports B) this country’s international debt accumulates C) this country is a net international lender D) all of the above 24. A country’s international debt must increase if ___________________________. A) its current account is in deficit B) its financial account is in deficit C) its international merchandise trade is in deficit D) all of the above 25. For the US to decrease its current account deficits, which of the following should be workable? A) policies designed to cut government budget deficits and promote national savings B) policies designed to cut domestic investment C) policies designed to tax imported goods D) policies designed to protect domestic infant industries

Compare the European takeover of Colombia with the conquest of Peru. What were the long-term effects of these differences?

1. The overnight lending rate is

a. the interest rate the banks charge one another on overnight loans, whereas the prime interest rate is the interest rate banks change on loans to their most creditworthy customers.

b. the interest rate the banks charge on loans to their most creditworthy customers, whereas the prime interest rate is the interest rate banks charge their largest and most preferred business customers.

c. the interest rate the banks charge on loans to their most creditworthy customers, whereas the prime interest rate is the interest rate banks charge one another on overnight loans.

d. the interest rate the Bank of Canada charges banks for a loan, whereas the prime interest rate is the interest rate banks charge their preferred customers.

2. The overnight lending rate is

a. lower than the prime interest rate because federal funds are loaned overnight.

b. higher than the prime interest rate because there are many alternative uses for the funds and opportunity costs must be accounted for.

c. nearly the same as the prime interest rate because they are both short term loans.

d. not comparable to the prime interest rate since the lenders are different.

3. Changes in the overnight lending rate and the prime interest rate closely track one another because

a. there are fewer prime rate reserves available for lending.

b. both rates are related to the relative scarcity or availability of reserves.

c. all interest rates will be equal whether the customers are banks, businesses, or households.

d. the Bank of Canada arranges this to be the case.

Before addressing the following questions, you will first need to collect some data! Use online websites (such as Wikipedia) to find economic data for Japan, USA, India, Italy, Iraq, and Mexico. Specifically, find recent data for per capita GDP and government debt-to-GDP ratio.

1. Based on the data collected, do you think that debt is a problem faced by economically advanced countries, undeveloped countries, or both? Justify your answer.
2. The United States government has a 100% repayment rate—it has always repaid its debt. Given what we know about risk and return, do you think the USA is generally charged high or low interest rates on borrowing money? Similarly, do you think Iraq (a poor and economically unstable country) is likely to pay high or low interest rates on loans?
3. Explain the concept of “crowding out”. Based on the data collected, which of these countries likely has the most extensive “crowding out”? Explain.

You want to develop a regression model about the 2004 presidential election. The objective is to explain percentage of votes received by the Democratic candidate in each state. The explanatory variables are:

(i) unemployment rate in each state,

(ii) gender dummy (female =1 and male = 0),

(iii) a dummy variable for Bill Clinton’s appearance in the state to campaign,

(iv) an interaction term between the gender dummy and the Clinton dummy.

You want to consider a variety of models. Model I contains the variables in (i) and (ii). Model II contains the variables in (i), (ii), and (iii). Model III contains the variables in (i), (ii), (iii) and (iv).

1. Write down each of the above three regression models. Be sure to define all notations.
2. Interpret all the coefficients in Model III.
3. Using Models II and III, indicate how you would test the following hypotheses. Be sure to write down the null hypothesis, restricted and unrestricted models, etc.
   1. Unemployment doesn’t matter.
   2. Clinton’s appearance had no effect.
   3. Clinton’s appearance had same effect for both males and females.