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1. Assume that the demand for autoworkers declines significantly due to a decrease in demand for new automobiles. Explain what will happen to unemployment using both classical and Keynesian reasoning.
2. Explain why the length and severity of the Great Depression necessitated a fundamental rethinking of the operations of the macroeconomy.
Calculate the initial investment outlay and operating cash flow
The local economists estimate that Y is equal to $12,000 and Monopoly has set Pc at $10. If Monopoly's MC of serving another customer is equal to $1, what is the profit maximizing price for seasonal passes
Consider the following exchange economy with two consumers and two goods. Consumer 1 has utility function u(x,y) = x1/2 y1/2 and initial endowments (ex,ey)=(1,0). Consumer 2 has utility function u(x,y) = x2 y and initial endowments (ex,ey)=(0,1).
What is meant by comparative statics?
What would be the profit for the given number of students?
How can we reconcile this fact with our theory?
You are considering making an investment which, if it pays off, will give you a payoff of $100,000, but if it fails, it will give you a payoff of $20,000. Each outcome is equally likely. What is the risk premium for this lottery?
What is the rationale for this statement?
n a given day, once you subtract 8 hours for sleep, you effectively have 16 hours from which you can choose to work or enjoy leisure (that is to say, sleep doesn't count as leisure). You have a job that pays $20/hour and that is your only source o..
Say that investment increases by 100 for each interest rate drop of 1 percent. Say also that the expenditures multiplier is 3. If the money multiplier is 5, and each 5-unit change in the money supply changes the interest rate by 1 percent, what op..
Just by scanning the headlines, see how many possible explanations you can list. How do they compare to the explanations reviewed in the chapter case study?
Assume that the reserve requirement is 5%. All other things equal, will the money supply expand more if the Federal Reserve busy $2,000 worth of bonds or if someone deposits in a bank $2,000 that he had been hiding in his cookie jar
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