Assume the reserve ratio is 10%

Formula: Potential Expansion Deposits = 1/Reserve Ratio x Excess Reserves

County National Bank

ER = ______________________              Potential Expansion _____________________

2. FED (Federal Reserve Bank) buys a $10,000 bond from the bank. What is the potential impact on MS (Money Supply)?

3. FED buys a $10,000 bond from a bank customer. What is the impact on MS? Is there a difference between 2 and 3? Why?
4. Assume the money supply rule. Growth in Q is 5%; growth in V is 2%. How much should the MS grow to keep P constant? Assume MV = PQ

1. Under what circumstances should a firm apply strong incentives to a performance measure and when would it make sense to apply a weak or no incentive to a performance measure? Please give an example of each.

Describe two overall projections and their expected impact on the economy from the Monthly Labor Review "Projections-Overview and Highlights."

Question 21.

Shelley is maximizing utility in her consumption of mansions and Porsches. If the marginal utility from her last purchased mansion is twice the marginal utility from her last purchased Porsche, then we know

A) Shelley buys twice as many mansions as Porsches.

B) Shelley buys twice as many Porsches as mansions.

C) Shelley buys more Porsches than mansions, but we do not know how many more.

D) the price of a mansion is twice the price of a Porsche.

E) the price of a Porsche is twice the price of a mansion.

How does overconfidence lead to bubbles?

explain 4 ways of asset management

3. a. Illustrate the effects of the current increase the money supply on output in the both the short-run and long-run under natural rate theory using the AD/AS model.

b. Explain the lags that can influence the ability of monetary policy to address an economic downturn. Of the four lags, which are not important and which are important to monetary policy.

Use supply and demand to explain and show the following real-world situations graphically and in a short paragraph. Be sure to explain what happens to the market quantity and price with a supply and demand diagram as precisely as possible.

a) The cost of producing sport utility vehicles (SUVs) decreases because tariffs are reduced on the steel and aluminum used to produce these vehicles. Explain what happens to the market quantity and price of SUVs.

b) The fungus Fusarium destroys 30% of worldwide banana production. Explain what happens to the market quantity and price of bananas.  

c) On Valentine’s Day, the price of roses increased by more than the price of greeting cards. The price of greeting cards didn’t even appear to change. Why? You will want to use graphs of both the market for roses and the market for greeting cards to explain your answer.

What are the stahes in the policy process and may you explain them. POLS. PUBLIC POLICY BOOK SIXTH EDITION BY KRAFT FURLONG

Newsprint (the paper used for newspapers) is produced in a perfectly competitive, constant cost, market. Each identical firm has total cost equal to TC = 32+ 20q + 0.5q2, where q is the amount of output produced by each firm. What is the quantity produced by each firm in the long-run? What is the long-run price?

Poor economics and its role in the global economy?

12. Suppose the economy is in long-run equilibrium. If there is an increase in consumer spending due to a tax rebate at the same time that a natural disaster adversely affects the availability of production inputs within the country, then in the short-run we would expect
A. the price level will rise, and real GDP might rise, fall, or stay the same.
B. the price level will fall, and real GDP might rise, fall, or stay the same.
C. real GDP will fall and the price level might rise, fall, or stay the same.
D. real GDP will rise and the price level might rise, fall, or stay the same.
E. the price level might rise, fall or stay the same and real GDP might rise, fall, or stay the same.
13. Suppose the economy is in long-run equilibrium. If there is a significant consumption (sales) tax increase at the same time that major new sources of oil are discovered in the country, then in the short-run we would expect
A. real GDP will fall and the price level might rise, fall, or stay the same.
B. real GDP will rise and the price level might rise, fall, or stay the same.
C. the price level might rise, fall or stay the same and real GDP might rise, fall, or stay the same.
D. the price level will rise, and real GDP might rise, fall, or stay the same.
E. the price level will fall, and real GDP might rise, fall, or stay the same.
14. Suppose the economy is in long-run equilibrium. If there is an expansion of government spending at the same time that a significant increase in immigration of skilled workers reduces production costs, then in the short-run we would expect
A. real GDP will fall and the price level might rise, fall, or stay the same.
B. real GDP will rise and the price level might rise, fall, or stay the same.
C. the price level will fall, and real GDP might rise, fall, or stay the same.
D. the price level will rise, and real GDP might rise, fall, or stay the same.
E. Either A or C will occur.

Minnesota Wave Rentals incurs a marginal cost of $48 per day of providing a WaveRunner to a tourist. Minnesota Wave Rentals has daily fixed costs of $8,000. The daily demand curve facing Minnesota Wave Rentals is P = 240 – 0.10*Q, with Q representing the number of WaveRunners rented, and P representing the price-to-rent rate charged to tourists.

Show your explanations and math in the spaces below (typed), or if you use Excel, please state your results in the spaces below, and refer to your uploaded Excel file.

a)What is the profit-maximizing price to rent a WaveRunner? How many WaveRunners will Minnesota Wave Rentals rent per day? What are Minnesota Wave Rentals’ daily total revenues, total costs, and total profits?

b) If Minnesota Wave Rentals’ marginal cost increases to $60 per day due to a tax on each personal watercraft rental to support state tourism advertising, what would be the profit-maximizing price to rent and quantity rented?

c) If, instead, Minnesota Wave Rentals’ fixed costs change, to $10,000 per day, due to higher dock fees all over Minnesota, what would be the profit-maximizing price to rent and quantity rented?

d) Use marginal analysis to explain the difference in how Minnesota Wave Rentals should respond to increased marginal cost vs. increased fixed cost.

Consider the following production function: f(x,y)=x+y^0.5. If the input prices of x and y are wx and wy respectively, then find out the combination of x and y that minimizes cost in order to produce output level q. Also find the cost function.