QUESTIONS 1-2 test your understanding of the causes and consequences of economic growth.

1. Is population growth good for idea generation? A Yes, population growth is good for idea generation. B No, population growth is bad for idea generation.

2. Are people in the U.S. better off when other countries grow rich? A Yes, people in the U.S. are better off. B No, people in the U.S. are worse off.

According to Smith, what effect does the number of people participating in the economy have on society’s wealth? Why?

c = 100 + 0.8 (y - t)

i = 500 - 50r

g = 400

t = 400

M^d = P(0.2y + 500 – 25r)

Price level is fixed at 1.

The money supply is 520

1. The government increases taxes by one unit.

1. Calculate the shift of the IS curve.
2. What is the change in the level of aggregate demand?
3. What is the change in the interest rate and investment?
4. What is the change in disposable income and consumer expenditure?
   e. What is the change in the government’s budget balance?

Assume an economy with 1000 consumers. Each consumer has income in the current period of 50 units and future income of 60 units and pays a lump-sum tax of 10 in the current period and 20 units in the future period. The market real interest rate is 8%. Of the 1000 consumers, 500 consume 60 units in the future, while 500 consume 20 units in the future.

a) Determine each consumer’s current consumption and current saving

Explain what is meant the term ‘trade deficit’ and how it is ‘automatically’ corrected through economic forces.

1. Suppose the following occurs: (1) There is a decrease in households’ wealth due to a decline in the stock market, (2) and at the same time, the government restricts the amount of cars that car companies can produce by placing an emission tax on each car produced. (3) the shift in the AD curve shifts more than the shift in the AS curve. Based on this information, in the short run equilibrium Price Level will __________ ; the equilibrium real GDP will _________;and the unemployment rate will __________.(Hint: Draw the initial AD and AS curves and then on the same graph draw the new AD and AS curves to derive your final answer).

a.	rise; fall; rise
b.	fall; rise; rise
c.	fall; rise; fall
d.	rise; rise fall
e.	fall; fall; rise

2. During the Great Recession, real gross domestic product (GDP) decreased and the unemployment rate increased to above-normal levels.Which of following best explains why this happened?

a. A significant decline in military spending following the end of a war led to a recession.

b. A sharp recession followed the United States abandoning the gold standard.

c. A decline in housing prices and stock prices, plus a financial crisis, caused a recession.

d. A sudden increase in oil prices caused inflation and a deep recession.

e. A stock market crash, large numbers of bank failures, an increase in tax rates, and a tight money supply caused a recession.

3. Senator Willie Mays, who retired as a player for the San Francisco Giants, proposes that income tax structure be revised to have two tax rates. The first tax rate, 25 percent, applies to persons whose income is between $0 and $50,000 a year. The second, 10 percent, applies to persons whose income is more than $50,000 a year. This is a

a. regressive income tax structure.

b. proportional income tax structure.

c. progressive income tax structure.

d. cyclical income tax structure

4.Classical economists believe that the economy is stable and tends toward full employment because

           a. the government plays an active role in managing the economy.

           b. savings is a drain on demand and must belimited.

           c. the short run is more important than the long run, and economic policy only works in the short run.

           d. prices are flexible and allow the economy to quickly return to full employment.

           e. prices are sticky and will not prevent the economy from adjusting to full employment.

write an essay on Ecommerce and its impacts on supply chain management

1)

Using the firm's information shown below answer the following questions:

Q= f(K, L) =10KL

w=$25

r=$40

MPk= 10L

MPl= 10K

A)

in the short run if the firm's capital is fixed at 25 units, how much will it cost them to produce q=500

B)

Will the firm do in the long run to minimize the cost of producing q=500

C)

What are the firms cost saving from the short-run is (2 when Q=100, 4 when Q=200 and 10 when Q= 500) to the long run is ( 3.87 when Q=100, 5.47 when Q=200, and 8.6 when Q=500)

1. Briefly explain the political and economic reasons for the revolts against Communism that led to the collapse of the Soviet Bloc.

2. Analyze the two major factors for the population increase in the 20th century.

3. Explain briefly the five major trends of global concern.

1. why Federal Reserve was created, 2. The organization of Federal Reserve, 3. The role of the Federal Reserve in Monetary Policy. You paper has to include references.

5. The Economist observed the following: In Argentina, many loans were taken out in US dollars” this had catastrophic consequences for borrowers once the peg collapsed.” What does it mean that Argentina’s “peg collapsed”? Why was the end of the peg (fixed exchange rate regime) catastrophic for borrowers in Argentina who had taken loans in US dollars?

How has journalism affected the road towards a gradual growth of democratic society?

explain in 3-4 paragraphs

1. For a Monopolist, the inverse demand function is P=80 – Q (Or, the Demand function is Q = 80 – P, if you prefer). The firm’s total cost function is 20 + 5Q + .5Q².
   1. Identify profit maximizing quantity and price   Q = _____, P = _____
   2. Graph the relevant curves in the area provided (Hint: If you have difficulty drawing the graph, try plotting a couple of points along the curve)
   3. Identify CS and PS in the graph Calculate CS and PS: CS = ________ PS = ___________
   4. Calculate elasticity of demand at the profit maximizing price
   5. Calculate profit

Please list the monetary and fiscal policy that Canada has taken to overcome the negative impacts of COVID 19 on the macroeconomy. Choose one specific monetary policy and one special fiscal policy to analyze their effects on interest rate, output, the price level, and the unemployment rate in the short run and in the medium run in Canada, respectively.

1.

Complete the following table and calculate the inflation rates.

Consumer Price Index

Year	Cost of Living	CPI
reference base	$10,000	100
2013	$20,000
2014	$22,000
2015	$23,000

  % (precise to 1 decimal point, e.g., 9.4%)

  % (precise to 1 decimal point, e.g., 9.4%)

2.

Suppose a community has a total population of 500, of which 100 are youth under the age of 16, 100 work 40 hours per week, 100 work 1-39 hours per week, 100 have been looking for work in the past four weeks, 50 are retired, 25 are college students, and 25 stay home voluntarily.

What is the labor force?   

What is the working age population?   

What is the unemployment rate?   % (e.g., 12%)

What is the labor force participation rate?   % (e.g., 12%)

3.

An economy produces only fish and oranges. The table below shows the quantity produced and their prices in 2007 and 2008. What are the nominal GDP in 2007 and 2008? And what is the real GDP in 2008 using prices in 2007? (base year = 2007)

	In 2007		In 2008
Item	Quantity	Price	Quantity	Price
Fish	60	$3	66	$4
Oranges	70	$3	77	$6

Year	nominal GDP	real GDP	Growth rate
2007	$	$	-
2008	$	$	%

What is the real GDP in 2008?

4.

Excess reserves refer to the remaining cash reserves financial institutions have after satisfying the reserve requirement. Suppose a bank receives one and only one cash deposit of $6,000,000, and the current required reserve ratio is 10%. What is the excess reserves?

• A.

  5,400,000

• B.

  3,600,000

• C.

  4,000,000

• D.

  4,500,000

5.Shannon made $50,000 last year and received a $10,000 raise this year for her excellence at work. With the additional income, she spent $6,000 more this year. What is the marginal propensity to consume (MPC) for Shannon?

• A. 70%

• B. 50%

• C. 60%

• D. 40%

6.In the previous question, what is Shannon's marginal propensity to save (MPS)?

• A. 40%

• B. 60%

• C. 10%

• D. 30%

7.Suppose banks keep cash reserves as much as 5% of their deposits (currency drain ratio), and the current required reserve ratio is 10%. What is the money multiplier?

multiplier = (1 + CDR) / (RRR + CDR)

• A. 7

• B. 3

• C. 6

• D. 4

8.Suppose the U.S. real GDP in 2008 is $14 trillion, price level is 2, and velocity of circulation is 4. What is the quantity of money in the economy?

• A. 28 trillion

• B. 7 trillion

• C. 14 trillion

• D. 4 triliion