1a) This article looks at how technological advancement can impact employment (or workers). How can AI be a threat to employment? In what ways it may actually be beneficial for workers? For firms? For the economy?

b) Will robotics be a continuous problem for employment? What might be some of the costs of unemployment, to the unemployed worker and to the society as a whole, besides the worker’s loss of income?

Character and Personality for the President Barrack Obama. Perhaps harder to determine but just as important in evaluating a president are the personal qualities the person brings to the office. Historians have reached consensus on the following traits as being important to a president: intelligence, honesty, integrity, character, flexibility, adaptability, and most importantly decisiveness. What about presidential relationships (i.e., with Congress, the press, the courts, the public, etc.)? Here you should look at popularity (do not place too much emphasis on opinion polls e.g., look at Reagan and Bush, neither will be considered Great presidents; Harding was extremely popular yet consistently considered a failure).

3. A small town has only one doctor. He charges a rich person twice as much as a poor person for a similar consultation.

a) How does this pricing policy relate to the price elasticity of demand? Are resources being used efficiently? Explain.

b) Suppose now that the doctor charges everyone the maximum price they would be willing to pay. What happens to consumer surplus? Will resources the allocated efficiently in this case? Explain and illustrate your answer with a graph

Define business cycle and give indicators along each phase.

During a particularly dry summer, officials in Tucson, AZ worry that their existing water supplies are not large enough to meet residents’ basic needs and they begin to discuss measures for reducing the city’s water consumption. Residential water use consists broadly of “indoor” use (drinking, cooking, bathing, laundry, etc.) and “outdoor” use (watering grass, washing cars, filling up swimming pools, etc.). The city, being reluctant to raise water rates, wants to place a ban on outdoor water use because using water in this way seems less “essential.” As an economist, you wonder whether it might be better to increase water prices and allow residents to decide for themselves how to allocate water across different uses. To make a more formal case, you obtain data on Tucson’s water demand in each sector (indoor and outdoor) and decide to calculate the deadweight loss associated with this outdoor water ban.

You will find that demand for “indoor” water (?_??) and “outdoor” water (?_???) are given by

? = 150 − 3?_?? and ? = 20 − 0.2?_???

1. Compute the deadweight loss ($/day) associated with the ban on outdoor water use. (To find this number, you can use figure like the one shown below.)

2. What is the price ($/1,000 gal.) that Tucson should charge to bring the city’s total residential water consumption down to ?̅?

All that is needed to solve is QUESTION 5 & its sub-parts...

Asymmetric Information and Separating Equilibrium

A population has two equal-sized members of "healthy" and "unhealthy" individuals. Members of each type have the same, identical, utility function: U = 20Y0.5 (i.e. 20 x Y raised to the 0.5 power), where Y is annual income.

Assume each individual, in either group, has disposable income (after normal expenses) of $19,000 a year. If in need of major medical care (and does not have insurance), each individual will have $15,000 in medical expenses. A "healthy" individual has a 6% probability, while an "unhealthy" individual has a 18% probability, of requiring major medical care.

Use the information above to answer the questions (1 through 5) below.

NOTE: An actuarially fair insurance premium (AFIP) is always calculated as: AFIP = (Medical expenses covered) x (Probability of occurring).

1. Calculate the AFIP of the full-coverage policy for a "healthy" individual.

2. Calculate the AFIP of the full-coverage policy for an "unhealthy" individual.  

3. Calculate the AFIP of a deductible policy for a "healthy" individual, for which the deductible is equal to $12,000.

4. Calculate the AFIP of a deductible policy for an "unhealthy" individual, for which the deductible is equal to $12,000.

5. Suppose health status ("healthy" or "unhealthy") represents asymmetric information: Each individual knows her or his health status, but insurance companies do not.  

Now, suppose an insurance company offers only two types of policies: 1) a full-coverage policy with premium equal to the most expensive (regardless of insurance type) of the two full-coverage policies.

a. In the boxes below, calculate expected utility for a "healthy" individual, for each scenario:

No Insurance:

Most Expensive Full-Coverage Policy (Option 1):

Least Expensive Deductible Policy (Option 2):

b. In the boxes below, calculate expected utility for an "unhealthy" individual, for each scenario:

No Insurance:

Most Expensive Full-Coverage Policy (Option 1):

Least Expensive Deductible Policy (Option 2):

c. Based on your answers in 5a. and 5b., which option would a representative member of each group (i.e. "healthy" and "unhealthy") choose?

d. In the box below, enter the insurance company's expected economic profit from selling the desired policy (from the individual's perspective) to a member of each group.

Expected Profit from "Healthy":

Expected Profit from "Unhealthy":

Identify the vast demand for natural resources in the East Asian realm, the types of resources that are utilized, and how the high demand has impacted the economies and histories of East Asian countries.

1. What happens to the long-run equilibrium price and quantity of cashew milk if almond milk becomes more expensive AND cashews (that are used in the production of cashew milk) less expensive?

   		Price increases and the change in quantity is ambiguous.
   		Price decreases and the change in quantity is ambiguous.
   		Quantity increases and the change in price is ambiguous.
   		Quantity decreases and the change in price is ambiguous.

QUESTION 7

1. If the price elasticity of demand is 2, what is the percentage change of price that is consistent with a decrease in quantity demanded of 40%? [Type a whole number, no gaps. If the number is positive don't put any sign, if negative put a minus in the front.]

QUESTION 8

1. If the price elasticity of demand is 0.5, what is the percentage change of quantity demanded that is caused by a 10% increase in price? [Type a whole number, no gaps. If the number is positive don't put any sign, if negative put a minus in the front.]

QUESTION 9

1. The income elasticity of demand for good X is -0.5. What can you infer about good X?

   		The demand for good X is inelastic.
   		The demand for good X is elastic.
   		Good X is a normal good.
   		Good X is an inferior good.

QUESTION 10

1. The cross price elasticity of demand for good X and good Y is -1.2 and the income elasticity of demand for good X is 0.5. What can you infer about good X?

   	a.	Good X and good Y are complements.
   	b.	Good X is a normal good.
   	c.	The demand of good X is inelastic.
   	d.	All of the above.
   	e.	(a) and (b) are correct
   	f.	(a) and (c) are correct.
   	g.	(b) and (c) are correct.

Determine if each statement is True/False

6. An increase in the money supply shifts the LM curve to the right.   

7. Expansionary monetary policy is not effective in increasing domestic output under floating exchange rate regimes.

8. An increase in G shifts the IS curve to the left.

9. An increase in domestic interest rates increases the capital account.   

10. An increase in e ($/£), a dollar depreciation, should result in an increase in export revenues.   

11. A currency depreciation shifts the BP curve to the left.

12. A decrease in consumption C shifts the IS curve to the right.

13. An increase in interest rates shift the Aggregate Expenditure curve to the right.   

14. Expansionary fiscal policy is relatively more effective in increasing output in a floating exchange rate regime compared to a fixed exchange rate regime.   

15. Expansionary monetary policy is relatively more effective in increasing output in a floating

exchange rate regime compared to a fixed exchange rate regime.

16. According to the GG-LL model optimum currency areas are most appropriate for areas closely integrated through international trade and factor movements.

17. According to the GG-LL model, an increase in the size and frequency of shocks in the domestic economy will shift the LL curve to the right.                                                             

A firm has the following long run production function x = a(K^1/2)(L^1/2)(P^1/4), where a > 0 is a constant and K, L , P are inputs of the three factors. The prices of K, L , P are Rs. 1 , Rs. 9 and Rs. 8 respectively.

a) Derive the firm’s long run total cost function , long run average cost function and long run marginal cost function. Show the workings in detail

b) In the short run P is fixed and K and L are variable. Derive the firms short run a) Total Cost Function b) Variable Cost Function c) Average Variable Cost Function d) Marginal Cost Function.

c) Obtain an equation of the form P = f(x) showing the optimum quantity of the fixed factor P for the firm to acquire as a function of the intended output x.

How would you contrast the efficiencies of oligopoly with those of monopoly?

2.   A small community currently taxes residents to provide monthly community concerts. Voter A currently pays a tax per concert equal to $50 per month. This voter receives a marginal benefit of $75 at the current political equilibrium number of concerts per month. Voter A:

a.    is the median voter.

b.   would be made better off if the number of monthly concerts were increased.

c.    would be made worse off if the number of monthly concerts were increased.

d.   has achieved his most-preferred political outcome for monthly concerts.

3.   If all voters have single-peaked preferences, then under majority rule:

a.    cycling of political outcomes can occur.

b.   a political equilibrium exists.

c.    the political equilibrium is the median most-preferred outcome.

d.   both (b) and (c)

4.   Voter A will normally vote in favor of one security guard per week because his marginal benefit is $125 and his tax share is $100 per week. Voter A receives zero marginal benefit from one concert a week and would vote against it. Voter B receives $125 marginal benefit from one concert per week but no marginal benefit from one security guard. One concert per week also will fail to gain a majority when put to the vote. Assuming that both Voter A and Voter B will pay $100 per week in tax for each concert and each security guard,

a.    they can both gain by engaging in logrolling on the two issues.

b.   pairing the issues on one ballot will result in both Voter A and Voter B voting in favor of the combined issue.

c.    pairing the issues on one ballot will result in both Voter A and Voter B voting against the com­bined issue.

d.   implicit logrolling will result in Voter A voting in favor of the combined issue, but in Voter B voting against it.

5.   If bureaucrats seek to maximize the size of their budgets, they will:

a.    seek to fund levels of services up to the point at which MSC = MSB.

b.   seek to fund levels of services for which TSB > TSC.

c.    seek to fund levels of services for which MSC > MSB.

d.   both (b) and (c)

6.   The demand curve for a pure public good is:

a.    obtained by adding the quantity demanded at each possible price for all consumers.

b.   obtained by summing the marginal benefits of each consumer for each possible quantity.

c.    always upward sloping.

d.   always a flat line.

7.   A voter’s most-preferred political outcome will be that for which the:

a.    marginal benefit of a pure public good is equal to the voter’s tax share per unit.

b.   total benefit per unit of a pure public good is equal to the voter’s tax share per unit.

c.    difference between the marginal benefit of a pure public good and the voter’s tax share per unit is maximized.

d.   marginal benefit of a pure public good is equal to zero, no matter what the voter’s tax share per unit.

13. If the quantity of good A is on the vertical axis and the quantity of good B is on the horizontal axis, the slope of the corresponding isocost line is:

a.    the price of good B divided by the price of good A.

b.   the negative of the price of good B divided by the price of good A.

c.    the price of good A divided by the price of good B.

d.   the negative of the price of good A divided by the price of good B.

14.   If the quantity of good A is on the vertical axis and the quantity of good B is on the horizontal axis, the marginal rate of technical substitution of the corresponding isoquant line is:

a.    the marginal product of good B divided by the marginal product of good A.

b.   the negative of the marginal product of good B divided by the marginal product of good A.

c.    the marginal product of good A divided by the marginal product of good B.

d.   the negative of the marginal product of good A divided by the marginal product of good B.

15.   If the quantity of good A is on the vertical axis and the quantity of good B is on the horizontal axis, then the cost-effective mix between the two goods occurs when:

a.    the slope of the associated isoquant line equals the price of A divided by the price of B.

b.   the marginal rate of technical substitution equals the price of A divided by the price of B.

c.    the marginal rate of technical substitution equals the price of B divided by the price of A.

d.   either (a) or (c).

. Two friends are playing a matching card game where friend 1, Max, chooses an Ace, Two, or Three and friend 2, Lucy, plays King, Queen, or Jack. They both put $ 5 each into the pot. Depending on what cards they play, they split the pot differently. The payoffs are summarized in the following table:

   Lucy

King Queen Jack

Max Ace (1,3)   (3,5) (2,4)

Two (6,5)   (3,3) (3,2)

Three (4,2) (5,4) (3,1)

(a) Use iterated elimination of strictly dominated actions (IESDA) to eliminate actions for Max and Lucy. Write out which action is dominated and HOW it is dominated (if you use a mixed strategy to eliminate another action, you need to specify the set of possible mixes or a particular mix).(4 points)

(b) Solve for all Nash Equilibrium/Equilibria of the game. Circle your answer. Explain why the set of actions you identify is a Nash Equilibrium. Write out the definition of Nash Equilibrium as part of your explanation. (8 points)

List the factors change demand and shift the demand curve. Tell what happens to demand and the demand curve when there is an increase in the factor

Discuss the problems of measuring productivity in actual work situations.

How might productivity be measured for each of the following industries?

a. Education(e.g.,elementaryandsecondaryeducation,highereducation—undergraduate and graduate)

b. Government (e.g., the Social Security Office, the Internal Revenue Service)

c. Manufacturing (e.g., soap and toothpaste, computers, heavy machinery)

d. Finance and insurance (e.g., banks, insurance companies, brokerage houses)