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Part A
1. Describe three (3) ways we can use macroeconomic analysis, with one (1) original example for each way.
2. You are running a small yard maintenance business for the summer. What do you expect to happen to the number of yards you can maintain in a day as you add workers if you don't purchase more capital equipment (like mowers and leaf blowers)? Provide at least two (2) supporting facts to support your response.
Part B
1. Using the real business cycle theory, explain two (2) effects of an adverse technological shock on the labor market and on the output market.
2. Suppose you were interested in increasing technological progress in your country. Suggest two (2) ways to do this.
A married couple is considering purchasing a new sport utility vehicle (SUV) 5 years from now. They expect the SUV to cost $32,000 at the time of purchase.
Short term Treasury bills [3 and 6 month] have current annual rates of interest around 0.5%. Use that info plus your best forecast of inflation to calculate the real rate of interest on those bills.
Explain should they stay in business for three months or should they close down right now.
Use a production possibility frontier to illustrate the probable results of your fiscal policy. By how much did consumption change? By how much did savings change?
An engineer considering for retirement decides that she wants to have income of $100,000 per year for 20 years with the first withdrawal starting 30 year from now.
A medium sized bakery has just opened in Slovakia. A loaf of bread is currently selling for fourteen koruna over and above the cost of intermediate goods
Which one shirts or sweaters, has a demand-elasticity which allow you to increase the price, sell fewer units BUT still increase your revenues.
Illustrtae the marginal product of labor.
Illustratr what is there is an increase in the supply of money.
An increase in input prices for rice production; and an improvement in rice production technology. Use diagrams to analyze the effects of these changes on equilibrium price and quantity.
Comprising a list and description of the tools organizations can use to manage risk in international finance.
Compute the employment rate (i.e., number employed: population) in each year? How can employment rate may go up or down in the unemployment rate stays the same? How can employment rate go up if unemployment rate also goes up?
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