Reference no: EM131190175
Q1. What do we call a very, very rapid and/or high increase in the general price level?
Q2. Suppose Pitcairn Island's small economy has 80 people working, 10 people are looking for work, and 10 people are retired. The total population is 100. What is the labor force participation rate?
Q3. Wolfers Reading: Name one issue on which economists are said to have reached consensus. What is the consensus on this issue, in general? (1-3 sentences)
Q4. In a chapter 2-type economy without government or foreign trade, suppose both consumption C and investment I arc positively related to aggregate output/income Y. That is, let:
C = a + bY and I = u + vY
Where a, b, u, and v are just given constants (a > 0, u > 0, 0 < b < 1, and 0 < v < 1). Note: Investment is now a function of Y instead of just a given constant I1.
a. Provide a one-sentence economic interpretation of b. (Don't just tell me its name. Don't just use algebraic terminology.) Do the same for v.
b. Find an expression for equilibrium output Y*. (Hint: Trust in the short-run equilibrium condition.)
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: Suppose Pitcairn Island's small economy has 80 people working, 10 people are looking for work, and 10 people are retired. The total population is 100. What is the labor force participation rate
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