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Assignment - Economics Questions
1-Suppose you have a market for gelato which is currently in equilibrium. Thinking of the supply and demand graph for this market, what would have to happen to cause both the equilibrium quantity of gelato in this market to fall and the equilibrium price of gelato in this market to fall? Is this even something that could happen?
In your answer, please pay attention to and describe what would have to happen to the supply and demand. (You may of course elaborate with any hypothetical "real life" reasons for any changes in the graph too.)
2-Marie is planning her schedule for the weekend. One of her friends has invited her to a two-day camping trip to Catalina. Another friend has offered an invitation to binge watch the Lord of the Rings movie trilogy (extended edition) on Saturday. Her cousin has invited her to a weekend beer tasting festival. Lastly, her uncle has invited him to a weekend of Dungeons and Dragons.
a. Describe how Marie might approach this scenario and his decision-making process. Is there an economic concept (or concepts) which best describes Marie's scenario?
b. Why does Marie even have to make a decision? What economic principle is causing this scenario?
Why might it be difficult for the Fed to formally adopt inflation targeting? Would inflation targeting be a good policy for the Fed in the present economic environment
In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?
Describe the present economic crisis situation in Europe. Why has it been so difficult for the Europeans to find a solution to this problem? Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..
Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.
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Problem based on Utility Function - Problem, Answer and explain the following using a diagram which is completely labeled.
Question based on Laffer Curve : Tax Rate and Tax Revenue, Do raising tax rates necessarily raise tax revenue? What factors affect how tax revenue changes when tax rates change?
Problem - Income Elasticity of Demand, Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5
Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."
Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.
How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.
Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?
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