Macroeconomics Answers

define production function and cobb-douglas production function?

according to the interest rate channel the traditional Keynesian, explain how a monetary tightening is transmitted to the real economy

The country of Adam Island which is located 17 degrees due west of Peter Island, experienced rapid economic growth 2014 to 2020 due to the construction of some major major hotels. As a result there was a significant increase in employment in hotel and restaurant sectors, retail trade and the construction sector. However in 2021 due to the covid-19 pandemic the tourism sector fell flat as there was a surge in the virus from the source market from which the tourists came from. This caused major unemployment in Adam Island.

Given the contraction that that was experienced, real GDP for instance fell from $900.0M Adam Island Dollars in 2020 to $750M Adam Island dollars in 2021. Expressed in market prices (or nominal prices), GDP for 2020 was $1,150M while in 2021 it was $975M Adam Island Dollars. 

What was the dollar value decrease in Real GDP from 2020 to 2021?

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.

Could you make a list and provide a brief description of some measures adopted by governments (/central banks) worldwide to support economy during Covid-19 pandemy? Explain the logic behind these monetary/fiscal- policy instruments using IS-LM model.

How would you describe the relation among interest rate (specify which one), GDP, unemployment rate, value of assets (common stocks, bonds, real estate etc.), firms‘ investment (you can add whatever variable you find relevant)?

 How can one measure a country’s GDP? What are its limitations as a measure of wellbeing? Do we have any alternative measurements of „wellbeing“?

How can one measure a country’s GDP? What are its limitations as a measure of wellbeing? Do we have any alternative measurements of „wellbeing“?

Why officially reported inflation rate does not have to properly represent inflation that an individual consumer faces?

 How the unemployment rate is measured using the ILO definition? Why such unemployment rate does not have to represent the „real“ number of available workers without a job.