1. Aggregate Demand curves slope down. Explain in a sentence what that means (what happens when Price Level falls, all else constant?) and give one reason for the negative slope (inverse relation).

2. Assume an economy operates in the intermediate range of its aggregate supply curve. State the direction of shift for the aggregate demand curve or aggregate supply curve for each of the following changes in conditions. What is the effect on the price level? On real GDP? On employment?

a. The price of crude oil rises significantly (300%, say) raising the price of energy generally.

b. Spending on national defense doubles.

c. Investment spending falls as firms expect slower sales growth.

d. An improvement in technology raises labor productivity.

e. The United States raises exports of new passenger aircraft to China.

3. Identify the three ranges of the aggregate supply curve. Explain the impact of an increase in aggregate demand in each range.

Question 1:

Almost all employees working for financial companies in New York City receive large bonuses at the end of the year. A sample of 63 employees selected from financial companies in New York City showed that they received an average bonus of $ 61 , 000 last year with a standard deviation of $ 16 , 000 . Construct a 98 % confidence interval for the average bonus that all employees working for financial companies in New York City received last year.

Round your answers to cents.

Question 2:

The high price of medicines is a source of major expense for those seniors in the United States who have to pay for these medicines themselves. A random sample of 1800 seniors who pay for their medicines showed that they spent an average of $ 4600 last year on medicines with a standard deviation of $ 600 . Make a 95 % confidence interval for the corresponding population mean.

Round your answers to cents.

The Zagat Restaurant Survey provides food, decor, and service ratings for some of the top restaurants across the United States. For 24 restaurants located in a certain city, the average price of a dinner, including one drink and tip, was $48.60. You are leaving on a business trip to this city and will eat dinner at three of these restaurants. Your company will reimburse you for a maximum of $50 per dinner. Business associates familiar with these restaurants have told you that the meal cost at one-third of these restaurants will exceed $50. Suppose that you randomly select three of these restaurants for dinner. (Round your answers to four decimal places.)

(a) What is the probability that none of the meals will exceed the cost covered by your company?

(b) What is the probability that one of the meals will exceed the cost covered by your company?

(c) What is the probability that two of the meals will exceed the cost covered by your company?

(d) What is the probability that all three of the meals will exceed the cost covered by your company?

1.) Vibrio cholerae is a Gram-negative, curved-shaped bacterial pathogen which causes nausea, vomiting, diarrhea and muscle cramps after consuming fecal contaminated water. Cholera killed thousands of people during the 1800’s as people traveled West to colonize the United States and more recently in Haiti after a devastating earthquake in 2010. Vibrio’s ability to cause potentially deadly diarrhea is due to a toxin it secretes called Cholera Toxin (CT). Vibrio is thought to have gained the gene which codes for CT from a bacteriophage.

A.) Which form of horizontal gene transfer (conjugation, transduction OR transformation) allowed Vibrio to produce the cholera toxin? (1p)

B.) Briefly describe the steps involved during this particular form of horizontal gene transfer. (2pts)

C.) Research and briefly explain how the rapid dipstick test works for identification of V. cholerae. Is it biochemical, immunological or genetic identification? (2pts)

Research the U.S. Tax Code to determine the manner in which deferred compensation is taxed. Conclude whether the treatment is reasonable. Provide support for your conclusions.
Provide one example of the tax treatment of deferred compensation. Discuss whether the taxation of this income harms taxpayers in general.
Propose an alternative to the taxation of deferred compensation that would be fair to all taxpayers and support the financial needs of the federal government. Indicate substantive ways in which your recommendation would achieve fairness to taxpayers and the United States Treasury.
Research recent IRS audit activities related to deferred compensation to determine the most frequent types of deferred compensation that would most likely trigger an IRS audit. Propose a strategy that you would use to defend a client facing an IRS challenge on deferred compensation.
Use at least three (3) quality references. Note: Wikipedia and other Websites do not qualify as academic resources.

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Suppose that workers are deciding whether to be a part of a union. If they join the union, the wage will be $31, the probability of employment will be 98%, the union fees will be $1.27, and the social costs are $.92. If they do not join the union, the wage will be $27, the probability of employment will be 94%, the union fees will be $0, and the social costs will be (-$3.12). Suppose also that utility for these workers is only a function of the listed variables.

a. Given the listed information, what choice will a utility-maximizing worker make when considering whether to join a union? (Provide details of your calculation and choice).

b. Would there be any reason for the union to consider making more negotiations concerning this situation? If so, what would the managers of the union try negotiating? If not, explain your rationale for this determination.

c. Examine the following statement through a logical, historical, and cultural lens (United States): “Workers choose whether to join a union”.

The Graduate Record Examination (GRE) is a standardized test commonly taken by graduate school applicants in the United States. The total score is comprised of three compo- nents: Quantitative Reasoning, Verbal Reasoning, and Analytical Writing. The first two components are scored from 130 - 170. The mean score for Verbal Reasoning section for all test takers was 151 with a standard deviation of 7, and the mean score for the Quantitative Reasoning was 153 with a standard deviation of 7.67. Suppose that both distributions are nearly normal. (a) A student scores 160 on the Verbal Reasoning section and 157 on the Quantitative Reasoning section. Relative to the scores of other students, which section did the student perform better on? (b) Calculate the student’s percentile scores for the two sections. What percent of test takers per- formed better on the Verbal Reasoning section? (c) Computethescoreofastudentwhoscoredinthe80thpercentileontheQuantitativeReasoning section. (d) Compute the score of a student who scored worse than 70% of the test takers on the Verbal Reasoning section.

According to Nielsen Media Research, the average number of hours of TV viewing by adults (18 and over) per week in the United States is 36.07 hours. Suppose the standard deviation is 8.8 hours and a random sample of 48 adults is taken.

a. What is the probability that the sample average is more than 35 hours?

b. What is the probability that the sample average is less than 36.6 hours?

c. What is the probability that the sample average is less than 28 hours? If the sample average actually is less than 40 hours, what would it mean in terms of the Nielsen Media Research figures?

d. Suppose the population standard deviation is unknown. If 75% of all sample means are greater than 34 hours and the population mean is still 36.07 hours, what is the value of the population standard deviation? (Round the values of z to 2 decimal places. Round your answers to 4 decimal places.)

You are the manager of a company that operates internationally providing agricultural equipment that has been manufactured and assembled in Canada. You have sold your products in the United States for many years and are now looking to enter other markets.
Your company has decided to enter the Argentinean market. You have decided to use a wholesaler, who will distribute it to the retail market. The potential size of the market is $10,000,000 USD per year. However, your wholesaler will not assume the risk of invoices charging USD and they want at least 60 days before paying. They argue that they will have to give their retailers 60 days to pay and their retailers will only pay them in pesos. Argentina has just come out of a currency crisis and your Canadian bank has warned you of possible severe currency fluctuations. What payment and currency strategy will you suggest to your senior management? Explain your answer (no calculations involved).