1. Why are some countries richer than others according to Adan Smith (1776)

2) Loanable Funds Market

2.1 Graph Supply Curve

  Explain in detail.

2.2) Graph Demand Curve

Explain in detail

2.3) Graph Supply and Demand in interaction

Explain Price equilibrium - Interest rate

2.4) Graph Supply and Demand when there is a Saving Incentive.

2.5) Graph Supply and Demand when there is a Tax Incentive.

Business cycles are pervasive in all macroeconomics variables. Does the relative duration of expansions and recessions help explain the fact that long term economic growth has been positive.

Identify the two major ways economic growth is measured.

Suppose that Lorenzo, an economist from a university in Arizona, and Neha, an economist from a school of industrial relations, are arguing over government bailouts. The following dialogue shows an excerpt from their debate:

Neha: Thanks to recent financial crises, the concept of bailouts is a hot topic for debate among everyone these days.

Lorenzo: Indeed, it's gotten crazy! A government bailout of severely distressed financial firms is unnecessary because free markets will properly price assets.

Neha: I don't know about that. Without a bailout of severely distressed financial firms, the economy will experience a deep recession.

1. The disagreement between these economists is most likely due to

A. differences in scientific judgments

B. differences between perception versus reality

C. differences in values

2. Despite their differences, with which proposition are two economists chosen at random most likely to agree?

A. Minimum wage laws do more to harm low-skilled workers than help them.

B. Lawyers make up an excessive percentage of elected officials.

C. Tariffs and import quotas generally reduce economic welfare.

Suppose a community faces a pollution problem because of emissions from a polluter with MAC=36- 2E. The information on pollution damages is given by MD=E .
(a) If there is a tax rate on emissions of $ 9/unit, then what is the emission level choosen by the polluter in equilibrium? What is the amount of its compliance costs?
(b) What is the socially efficient tax rate in the given situation?
(c) Now imagine a situation where the polluter bargains with the community ( let's say, with the community government) and offers to pay $6 for each unit of emission ( i.e. $6/unit) it is allowed to produce. What level of emissions is the community likely to allow? What is the likely net gain to the community from allowing those units of emissions?

Clinton Public Company Limited placed an advertisement on their web page as follows;    

“Anyone interested in going to the moon? We can provide this service to you at a cost of Five million dollars. Call 800-MOON and book your flight.”

Donald’s dream since he was a kid is be the first in his family to go to the moon. He heard about the advertisement, via a friend and immediately logged on to Clinton’s web page for further details. Donald immediately thereafter called 800-MOON and booked his trip for December 22^nd 2020, because he wanted to spend Christmas on the moon.

Donald’s wife Daisy subsequently discovered what her husband planned to pursue for the Christmas holidays and is furious. She was hoping that he should use his available monies to buy her a brand new Lamborghini. She confronted him on the issue and after a few hours of arguments, he agreed to buy her the Lamborghini and forsake his much-anticipated trip to the moon.

Donald called Clinton Public Company Limited and informed them that he no longer desired to go to the moon because of unforeseen circumstances. Clinton’s Customer Service Representative informed him that he had an agreement with them, because he accepted their offer when he called and booked his flight.

Donald is confused and is seeking your legal advice on this matter.

Use IRAC method and a case to answer.

- a) Calculate AE given the information below and completely fill in the table.

Taxes: $10 at each level of income

Investments: $15

Government Spending: $25

- b) Where is equilibrium in this economy based on the table? State the level, don’t just point to it or highlight it. (1 mark)

- c) Using the injections-withdrawals approach, demonstrate that the point you chose in part 2 is the equilibrium.At this point withdrawals = injections.

Injections-Withdrawals Approach

In 100 words Decide American Apparel. please type

In early March, 2020, our state government announced tentative plans to move homeless people in to college dorm rooms. A. In your opinion, is this idea a good idea? Or a bad idea? Why? B. Would you make this program voluntary for homeless people? Or mandatory? Why? C. How vigorously would you enforce this program? Why? D. What penalties, if any, would you impose on homeless people for non-compliance? Why? E. In theory, what could ‘go wrong’ with the enforcement of this program? What other support services do homeless people require, in addition to housing? F. Moving homeless people into hotel rooms, (combined with support services), which our state has done on an unprecedented level, may be a better idea than moving them into college dorms. Why? G. In your opinion, what more should we be doing as a society to address this issue? Why?

As a producer, which market structure is more favorable? Please explain your answer.

21. To deal with smog problem, the local governments in China and India have been known to restrict vehicle use for a few weeks during periods of severe smog problem. One approach used is to allow vehicles to run on streets on alternate days only (for example, even-numbered vehicles on one day and odd-numbered vehicles the next day).

(i) Is this kind of approach an economomically efficient way to get motor-vehicle emissions reduced to a desired/target level in our society ? Explain.
(ii) Suggest how we can use an emission tax policy to reduce motor-vehicle emissions to a desirable level in our society so as to deal with smog problem like mentioned above. Will the emission tax policy be cost-effective?

To deal with smog problem, the local governments in China and India have been known to restrict vehicle use for a few weeks during periods of severe smog problem. One approach used is to allow vehicles to run on streets on alternate days only (for example, even-numbered vehicles on one day and odd-numbered vehicles the next day).

(i) Is this kind of approach an economomically efficient way to get motor-vehicle emissions reduced to a desired/target level in our society ? Explain.
(ii) Suggest how we can use an emission tax policy to reduce motor-vehicle emissions to a desirable level in our society so as to deal with smog problem like mentioned above. Will the emission tax policy be cost-effective?