How many units will the firm produce in the short run

Assignment Help Macroeconomics

Reference no: EM131069682

Question 1 - Consider the following table.

Quantity	Total Cost
0	$ 46
2	$ 47
4	$ 48
6	$ 49
8	$ 51
10	$ 57
12	$ 65
14	$ 75
16	$ 87

(1) Suppose that the price of the product is $5. How many units will the firm produce in the short run?

(2) In the long run, will the price rise or fall from the current level at $5? Explain the reason.

Question 2- Consider a hypothetical economy that produces only oranges and olives. The production and price data for the years 2010, 2012, and 2013 are as follows.

2010 (Base Year)			2012		2013
Product	Price	Qty	Price	Qty	Price	Qty
Orange	$3	4,000	$3.50	4,100	$4	4,300
Olive	$5	200	$6.00	210	$8	220

(1) Compute the GDP deflators for the years 2012 and 2013.

(2) Using the GDP deflators computed in (1), calculate the inflation rates of the years 2012 and 2013.

Question 3- Consider an economy in which GDP is $8.2 trillion, public saving is -$0.2 trillion (negative number), taxes are $0.8 trillion, private saving is $3.0 trillion, export is $0.4 trillion, and import is $0.5 trillion. Calculate consumption, government purchases, national saving, and investment.

Question 4- Suppose that the T-account for First California Bank is as follows.

Assets		Liabilities
Reserves	$50,000	Deposits	$500,000
Securities	50,000
Loans	400,000

The Bank currently holds the reserves as required by the Fed, and all other banks in the nation do just the same, i.e., hold the exact amount of reserves as required by the Fed.

(1) Suppose that the Fed buys $20,000 securities from First California Bank, as part of the Fed's policy action to continue "quantitative easing." Draw the new T-account for First California Bank right after the purchase by the Fed.

(2) Suppose that all banks, including First California Bank, continue to holds the exact amount of required reserves. As a result of the Fed's purchase of $20,000 securities from First California Bank, how much of money supply will change? Is the change in money supply an increase or a decrease?

Question 5- Smith, a U.S. citizen, has been working as an executive of a telecommunication company in U.S., and her annual salary in 2014 was US$250,000. Her salary was expected to remain unchanged if she continued to work in the company. At the end of the year 2014, however, she was recruited by a media company in Brazil, so she started working in Brazil from January 2015, making an annual salary of US$360,000. Assuming that the amount of her salary equals the amount of her contribution to the production in the company she works for, how much the annual U.S. GDP and GNP in 2015 was changed due to her job relocation?

Reference no: EM131069682

Questions Cloud

Write on how buffer overflows are used to exploit computer : Write a paper on how buffer overflows are used to exploit computers. Give real world examples of buffer overflow attacks and describe of you would protect your system from this type of exploit. Include images and diagrams.

Portion of the central processing unit : What is the portion of the central processing unit that coordinates the activities of all the other computer components?

Possess special traits that influence their behaviors : Charismatic leaders are said to possess special traits that influence their behaviors. Three such traits described in the chapter are envisioning, empathy, and empowerment. Explain how each of these traits influences how followers perceive the ch..

Both beneficial and detrimental effects on followers : A strong emotional attachment and loyalty to a charismatic leader can have both beneficial and detrimental effects on followers. Explain both types of effects on followers

How many units will the firm produce in the short run : Suppose that the price of the product is $5. How many units will the firm produce in the short run? In the long run, will the price rise or fall from the current level at $5? Explain the reason

Charisma you think best describes the individual : Martin Luther King, Jr., Gandhi, John F. Kennedy, Adolph Hitler, Nelson Mandela, David Koresh (of the Branch Davidians), Herb Kelleher (of Southwest Airlines), and Richard Branson (of the Virgin Group) are/were charismatic leaders.

Review the cpt and hcpcs coding systems : Now that you have had the opportunity to review the CPT and HCPCS coding systems and their application, compare those coding systems with that of ICD-10-CM.

Oprah winfrey launched harpo productions : In 1986, Oprah Winfrey launched Harpo Productions, Inc. Two years later, in October 1988, television history was made when Harpo Productions announced that it was taking over all production responsibilities for the Oprah Winfrey Show from Capitol ..

List a few mechanistic processes : List a few mechanistic processes for which the hydrostatic stress is likely to have a large influence on the corrosion-fatigue crack growth characteristics.

User Account

All Pages