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Assignment
1. How do Classical and Keynesian economists differ in their view of the aggregate supply curve? 75 WORDS
2. How does this influence what Classical and Keynesian economists believe about fiscal policy? 75 WORDS
3. How does the rate of population growth influences the level of GDP per person? 75 WORDS
4. Do you think the current President and Congress were taking Classical approach in their fiscal policies? Explain your answer. 75 WORDS
5. Consider a change in the tax code that might increase private saving. If this policy were implemented, how would it affect the market for loanable funds? 75 WORDS
6. What two problems impede the insurance market from working perfectly? 75 WORDS
7. How do you explain the view of those economists who are skeptical of the efficient markets hypothesis? 75 WORDS
8. Why are minimum-wage laws a better explanation for structural unemployment among teenagers or among college graduates? 75 WORDS
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 - 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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