1. what is a bank failure?

2. how do you prevent bank failure

3. what causes bank failure?

A war breaks out that is widely expected to last only one year. Show how the effect of this shock on aggregate output depends on the size of the intertemporal substitution effect of the real interest rate on current leisure, and carefully explain your results.

=How would David Harvey, drawing on Marx, explain the history of capitalism in terms of the spatial fix? Be sure to use appropriate Marxian terminology. How might you critique this history of capitalism by taking a more intersectional approach?

1. Barter system

a) the exchange of one good or service for another good or service.

b) coins, paper money and demand deposits in chartered banks.

c) can be converted quickly into case.

d) provides the lifeblood of the circular flow of income and expenditure.

Q. 1 The monetary base is the sum of

A. U.S Treasury notes and other government securities

B. currency and checkable deposits at depository institutions

C. foreign and domestic deposits at the Fed

D. currency and reserves of depository institutions

Q.2____________ of unemployment during _______________make it easier for workers to _____________wages

A. Low levels; an expansion; negotiate higher

B. Low levels; a recession; accept lower

C. High levels; an expansion; accept lower

D. High levels; a recession; negotiate higher

Q.3 How does an open market operation change the monetary base>

A. increases the quantity of currency, which increases; decreases the quantity of currency, which decreases

B. increases; has no effect on

C. increases; decreases

D. decreases; increases

Q.4 The sale of government securities by the Fed leads to

A. a decrease in bank reserves

B. a contraction in bank lending

C. a decrease in the monetary base

D. All of the above answers are correct

Q.5 The required reserve ratio

A. increases when withdrawals from a bank are made

B. is the amount of money that banks require borrowers to reserve in their account

C. is higher for banks that make riskier loans

D. is the fraction of a bank's total deposits that is required to be held in reserves

Q.5 The gap between ________ is the output gap.When ________, the output gap is called an inflationary gap.

A. real GDP and potential GDP; real GDP exceeds potential GDP

B. the interest rate and the price levels; real GDP exceeds potential GDP

C. the price level and the cost; real GDP equals the interest rate

D. real GDP and aggregate demand; real GDP equals potential GDP

Q.6 By itself, a supply shock such as an increase in the price of oil, will

A. cause real GDP to permanently decrease year after year

B. be inflationary as long as there is no policy response

C. not cause inflation if there is no policy response

D. cause a wage- price spiral

is econ a necessary part of life and if so, then why?

Wha happens to the global competitiveness landscape when automation reduces the labor cost?

Suppose that the USD has been significantly appreciating against the Japanese yen over the last several months and that the Federal Reserve is considering sterilized direct intervention to reverse this trend. What sterilized intervention steps would the Fed take to reverse the recent USD appreciation? That is, clearly and explicitly state the exact steps taken (and the timing of steps: Are the steps taken sequentially? Or are they taken at the same time?) to engage in the necessary sterilized direct intervention. Be sure to clearly specify which currencies are being exchanged and what government securities are being bought and sold (and by whom) – the details are important.

Is economics important for STEM occupations?

1) Consider a small country whose actions does not affect the world interest rate. Draw a loanable funds market for the country and analyze how Net Export and Net Capital Outflow changes when the following happens. Draw different graphs for each case.

a) The country’s government implements a policy to lower income taxes while keeping the government budget unaffected

b) The US (a powerhouse in the World market) implements a contractionary monetary policy to raise interest rate

Assume that you will run the following regression: yt = α + βxt + ut. You believe that the errors might be serially correlated in the following fashion: ut = γ0 + γ1ut−1 + εt

a) Will OLS estimation be inconsistent? Why?

1. What is First Order Autocorrelation and what effect does it have on the Least Squared Estimates of Linear regression model?

Suppose a profit-maximizing firm can effectively engage in second-degree price discrimination and is the only firm present in this market. The firm wishes to (and successfully does) impose a block tariff that consists of three separate blocks. The inverse market demand curve is given by P = a − bQ. The firm’s total cost curve is T C = f + cQ.

The firm’s profit-maximizing total quantity sold?

QUESTION 1

1. Payback period is the length of time needed for the sum alternative's costs and benefits at a given interest rate to equal zero (0).

   True

   False

QUESTION 2

1. When evaluating mutually-exclusive alternatives using B-C Ratio analysis, the alternative with the greatest B-C ratio is the most advantageous.

   True

   False

QUESTION 3

1. A discounted payback period is shorter than a non-discounted payback period because it doesn't assume a zero interest rate.

   True

   False

QUESTION 4

1. Timothy has a classic sports car that he bought in 2005 for $35,000. What type of analysis should he use to determine the car's estimated value in 2030?

   		Present Worth
   		Benefit-Cost Ratio
   		Equivalent Uniform Annual Worth
   		Future Worth

QUESTION 5

1. Which of the following statements does NOT describe an economically viable alternative?

   	1.	The Present Worth of the costs divided by the Present Worth of the benefits is greater than 1.
   	2.	The Equivalent Uniform Annual Cost divided by the Equivalent Uniform Annual Worth is less than 1.
   	3.	The Benefit-Cost Ratio is equal to or greater than 1.
   	4.	The Present Worth of the costs minus the Present Worth of the benefits is less than 0.