49. Which of the following is the most logically sound proof in favour of God’s existence?

(A) \Every society throughout human history has had some notion of God, and there-fore God must exist."

(B) \I feel God’s existence through the Holy Spirit, and therefore know that He exists."

(C) \Everything that begins to exist has a cause. The universe began to exist. There-fore, the universe has a cause, which I call God."

(D) \It is ridiculously unlikely that the universe just came into existence the way it is now, without some supernatural intervention. Therefore, God exists."

50. Which of the following NOT a method of incomplete induction?

(A) Via online surveys on SurveyMonkey.

(B) Online surveillance.

(C) Reading people’s diaries.

(D) Polling every single person you’re interested in.

51. The United States historically had the institution of slavery. This meant that there was a market for slaves. According to the textbook, what impact did Eli Whitney’s invention of the cotton gin have on the market for slaves?

(A) Supply increased.

(B) Supply decreased.

(C) Demand increased.

(D) Demand decreased.

Answer the following questions:

A- What is discretionary and non-discretionary fiscal policy?

B- What are the available tools of fiscal policy?

C- What is monetary policy and who conducts it?

D- What are the available tools of monetary policy?

Using these introductory questions, present a detailed essay-type analysis, with all the information from a reliable source, of what consists of at least three fiscal policy incentives and one monetary policy incentive as a consequence of the COVID-19. In total, at least four economic incentives that apply in Puerto Rico and/or the United States must be presented. In its analysis it must present a sequence of expected impact on the aggregate demand and aggregate supply curves and what the main incentive objective should be on the country's economic growth. It must present its arguments with all the analysis discussed in the course of the expected sequence of positive and negative reactions on the macroeconomic balance, identifying what type of fiscal and monetary policy is being activated and which macroeconomic variables (consumption, investment, government expenditure, exports and imports) are expected to be impacted.

Assume that there are only two countries in the world: USA and Brazil, so all international transactions are only between those two countries. The table gives the information regarding international transactions of USA in 2018:

1. Calculate the US trade balance
2. Calculate the US current account balance
3. Calculate the US financial account balance
4. Was the United States a net borrower or a net lender? Explain your answer.
5. Assume that an exchange rate of USD increased from 3.14 Brazilian Reals to 4.62 Brazilian Reals for 1 USD. Explain how this change may affect the US trade balance, current account balance, and the financial account balance.

2

2. Market structures

For each of the following scenarios, identify the number of firms present, the type of product, and the appropriate market model. Select the matching entry for each dropdown box in the following table.

Assume that there are only two countries in the world: USA and Brazil, so all international transactions are only between those two countries. The table gives the information regarding international transactions of USA in 2018:

1. Calculate the US trade balance
2. Calculate the US current account balance
3. Calculate the US financial account balance
4. Was the United States a net borrower or a net lender? Explain your answer.
5. Assume that an exchange rate of USD increased from 3.14 Brazilian Reals to 4.62 Brazilian Reals for 1 USD. Explain how this change may affect the US trade balance, current account balance, and the financial account balance.

If the economy starts at the natural rate of output, then in the short run a decrease in aggregate demand moves the economy to a lower level of output and, according to the Phillips curve, a higher level of unemployment as the inflation rate falls.

Select one:

True

False

In the long run, unemployment depends upon factors such as the nature of the job search process, the amount and duration of unemployment benefits and the power of unions and minimum wage laws that alter the amount of structural unemployment.

Select one:

True

False

According to the natural rate hypothesis (Friedman and Phelps), in the short run the economy will move to a point on the Phillips curve where the unemployment rate is lower if the inflation rate rises.

Select one:

True

False

Milton Friedman argued that the Fed's control over the money supply could be used to peg the level or growth rate of a real variable, but not the level or growth rate of a nominal variable.

Select one:

True

False

In the United States, the inflation rate has been consistently above 4 percent during the period from 2000 to 2015.

Select one:

True

False

3. One

1. One of the basic principles of classical growth theory is that over time, levels of economic activity should converge in most countries and that we would enjoy equal levels of prosperity. While we view some evidence of convergence, we also observe the continuation of stark and deep levels of global inequality

1. In one small paragraph, use our production function analysis to explain why we might predict economic convergence.
2. In an additional paragraph, use our production function analysis to explain why we might not be experiencing convergence.
3. What country are you a citizen of (UNITED STATES)? Use the growth theory you have used in your previous answer to explain whether you are part of a country that is either:

1. Catching up to advanced capitalist countries,

2. Being caught up to by more rapidly growing countries, or

3. Still experiencing a big gap in living standards with no immediate prospects of catching up.

Briefly explain why the country you are a citizen of falls into the category you have chosen.

1. 5 pts)The 6-month forward discount for converting the U.S. dollar into the British pound is 34% and 6-month U.S. Treasury bills yield 1.56%. Based on interest rate parity, what should be the 6-month British Treasury bill yield?

2. (10 pts)The current exchange rate is one Australian dollar (AUD) equal to 1.349 USD.   In the United States, the 6 months T-bill rate is 84%. The 6-month forward rate for AUD is .75 USD/AUD.  Assuming that interest rate parity exists, what is the implied interest rate for Australia?

3. (15 pts)Suppose the following conditions exist between the U.S. and Canada. 6 month U.S. interest rate = 4.5%. Canadian interest rate = 4%.  Spot rate: 1 CAD = .9537 USD. 6 month forward rate: 1 CAD = .9612 USD. Are the conditions of interest rate parity violated? If so, what would be our profit if we engaged in covered interest arbitrage by borrowing $2M in the U.S.?