Macropoland is currently experiencing a recession--consumption and investment are very sluggish, and unemployment is quite high at 9%. Currently, inflation is very low at 0.4% (the historical average rate of inflation is about 2%). The Macropolish President has just hired you as her economic advisor. Your job is to prescribe policy that would enable the economy to recover from the recession. Explain how you could use the standard tools of expansionary monetary policy and expansionary fiscal policy to stimulate this economy towards economic growth. Develop a response that includes examples and evidence to support your ideas, and which clearly communicates the required message to your audience. Organize your response in a clear and logical manner as appropriate for the genre of writing. Use well-structured sentences, audience-appropriate language, and correct conventions of standard American English.

Respond to the prompt with a five paragraph essay. The first sentence should be the statement of purpose. The first paragraph MUST include a strong thesis.

(Class is Principles of Macroeconomics)

The data provided below describe an ice-cream store’s daily production possibilities for milkshakes and sundaes.

Milkshakes: 0 20 40 60 80 100 120

Sundaes: 210 200 180 150 110 60 0

(a) Draw a correctly labeled graph of the store’s production possibilities curve (PPC) with milkshakes on the horizontal axis and sundaes on the vertical axis and label the endpoints using the numbers provided above.

(b) Is the opportunity cost of producing milkshakes increasing, decreasing, or constant? Explain using numbers in the table.

(c) The store is currently producing 80 milkshakes and 110 sundaes. Calculate the opportunity cost of increasing milkshake production from 80 to 100 milkshakes. Show your work.

(d) Would it be efficient for the store to produce 80 milkshakes and 150 sundaes? Explain using numbers in the table.

(e) Suppose the ice-cream store purchases a new machine that increases the output of milkshakes and sundaes. Show the effect of the change on the store’s PPC on your graph in part (a).

Assume both Atlantis and Zanadu produce helmets and baseballs. Using equal amounts of resources, Atlantis can produce 100 helmets or 200 baseballs, whereas Zanadu can produce 100 helmets or 400 baseballs.

(a) Assume both Atlantis and Zanadu experience constant opportunity costs in producing helmets and baseballs. Draw a correctly labeled graph illustrating the production possibilities curves (PPCs) for Atlantis and Zanadu, showing helmets on the horizontal axis and baseballs on the vertical axis. Plot the numerical values provided above on your graph.

(b) Calculate the opportunity cost of one helmet for Atlantis. Show your work.

(c) Which country has an absolute advantage in the production of baseballs?

(d) Which country has a comparative advantage in the production of baseballs? Explain.

(e) If Atlantis and Zanadu specialize based on comparative advantage and trade, would they be able to gain from trade if the terms of trade are 1 helmet for 3 baseballs? Explain.

Collect data on inflation and unemployment for the UK and the US during the 1970s and 1980s using OECD.stat. The 1980s was a period of significant disinflation for the two economies. Use the data gathered* and content of the chapter 4 of the textbook to answer the following questions:

a. Was the disinflation costly in terms of unemployment?

b. Does the data provide evidence that inflation expectations were being formed rationally during this period?

c. How can the concept of anchored expectations be used to suggest that the UK and US governments could have done to reduce the costs associated with disinflation.

(*) Plot the data with unemployment in the x-axis and inflation in the y-axis. Paste the charts at the beginning of your answer, and refer the analysis to them.

The builder of a new movie theater is trying to decide how many screens she wants. Below are her estimate of the number of patrons the complex will attract each year depending on the number of screens available. Number of screens: Total number of patrons 1 50,000 2 95,000 3 135,000 4 170,000 5 195,000 The owner expects to net $2 per ticket sold. Construction costs are $1,000,000 per screen. The screen can always be resold for $1,000,000 at the end of the year. However, the builder has to borrow $1,000,000 per screen and pay the lender the prevailing interest rate.

a) What is the marginal product per screen? In other words how much revenue does each screen generate

b) How many screens will be built if the interest rate is 6%

c) How many screens will be built if the interest rate is 8.5%?

d) How many screens will be built if the interest rate is 12%

Based on the materials we covered until now can you tell me in 150 words How has Business changed with so much data available?

3.a) Define the terms absolute advantage and comparative advantage.

b) Provide a real-world example from your personal or workplace experiences that demonstrate the concepts of absolute advantage and comparative advantage.

Hint: How household chores are divided-up among the members of your household is often a good example of absolute advantage and comparative

we talked earlier about measuring demand curves. how might we proceed if we want to measure congestion Externalities associated with various outdoor recreation activities?

Q2. If C=700+0.8Yd, I= 400, Tax=10%, & G= 200, then:

(A) Derive equation for AD
(B) Determine equilibrium value of output.

(C) Calculate value of multiplier

(D) Repeat first 3 parts if Govt. spending is increased to 300
(E) Show changes through graph.

The Watergate crisis in the early 1970s led to the first resignation of a sitting president in American history. What did Richard Nixon do in the Watergate crisis to lead to his resignation?

1- From the above table show the three stages of production?
2- Describe the relationship between marginal and average product.
3- If the price of output is $10 , and labor’s wage is $350. How many labors will be hired (L*)?

Inputs of labor Total
Product (TPL) Marginal product of labor (MPL) Average product of labor
(APL) Stages of production
0 0 — —
1 60
2 110
3 150
4 185
5 210
6 225
7 230
8 235
9 230

The simple case of pricing with market power assumes (a) all consumers are charged the same price, (b) the firm sells one product, (c) demand exists in one time period, and (d) competitors do not pursue pricing games. Discuss what happens as each assumption is relaxed.

A key dynamic within any Multi National Corporation (MNC) is management of cash and also foreign exchange risk exposure. Cash management is critical and also heavily influenced by global dynamics. Within the Caribbean and South American jurisdiction, the economic framework is tightly connected with the major Asian economies of China and Japan, as well as the United States and the United Kingdom. The Caribbean and South American economy respectively, have been a barometer of the global economic cycle. For the South American economy, many Multi-National Corporations have made significant investments in order to achieve a reduction in the production cost of goods and also diversification benefits. Despite the benefits that could possibly materialize, some South American countries have weak banking systems and also have not been resilient through Global market shocks and Financial Crisis. This weakness may be as a result of politics and the quality of prudential supervision. Given this context, respond to the following questions which require research with respect to the localized context and also within the current market dynamics.

“For a fixed exchange rate system to work successfully, the government that oversees its operations must be able to make tight budget and monetary policies prevail”. Agree or disagree and justify your position within the context of the Caribbean and South American Economy?

1. Sometimes when the U. S. economy starts pulling out of a recession, the unemployment rate actually rises for a time rather than immediately falling. This is commonly referred to as a "jobless recovery". There are 2 reasons for this strange phenomenon occurring. What are the 2 reasons? Explain. (Hint: Refer to the Extra PPT on Unemployment and Chapter 6 of the course text! You could also do an Internet search for "What is a jobless recovery?"!)

2. There are 3 types of unemployment in economics: frictional, structural, and cyclical. The first 2 types together constitute NATURAL UNEMPLOYMENT,, while the 3rd type is the excess unemployment above the natural unemployment (where the natural unemployment rate is believed to be at most 5% for the U. S. economy). Given this, when the economy pulls out of a recession, which type of unemployed workers would be hired first, those who are structurally unemployed or those who are cyclically unemployed? Explain why.

3. During the period 1983-1984, the inflation rate in Israel was 370% . Given this, if a dinner cost 10 shekels in an Israeli restaurant at the end of 1983, how much would that same dinner cost at the end of 1984 in Israel? Show all work and calculations and explain!

4. Between the period 1980 to 1985, policy makers in the United Kingdom worked to lower the inflation rate in the country. They were successful in their attempts. Given this, explain what happened to the unemployment rate in the United Kingdom during this period as a result of this successful policy. (Note that a lower but still positive inflation rate is known in economics as disinflation!)

Would you say that getting the current corona virus is an insurable or uninsurable risk? Why? If you answered uninsurable risk, which category would it fall under: Changes in the general economic environment, Changes in the structure of the economy, Changes in government policy, or New products or production methods pioneers by rivals.