Macroeconomics Answers

Find the marginal cost functions for each of the following average cost functions. a) AC = 1.5Q + 4 + 46 𝑄 b) AC = 160 𝑄 + 5 - 3Q + 2Q2

How does the provision of social security effect people's incentive to save while wroking?

a fiscal measure has no effect upon the level of income if____________

Y= c+I+g

C= 900+0.5(y-t)

I= 750-30r

T=800

G=1200

Md=Ms

Ms= 1500

Mt=0.7y

MSP=-80r

Derive ( Md/P) the demand for real money balances equation

Describe how a tax placed on the production of computers can affect supply

Economic indicators used to measure each macro-Economic objective

(a)Construct an annual ‘coffee price index’ for this time period using 2005 as the

base year. [Hint: follow the procedure detailed in the chapter – divide each yearly

price by the base year price.]

Discuss whether a cut in taxation will reduce inflation. 

Briefly define the following macroeconomic objectives and explain in your own words how each can be applied to improve the economy.

1. Economic growth and increasing employment
2. Stable and low inflation
3. Distributional and equity objectives and the reduction of inequality
4. Economic development and poverty reduction.

Using the IS-LM model, explain what could happen if the trust in bright future disappeared from capital markets. You can use some historical events as examples.