Macroeconomics Answers

Pizza Factori produced $88,000 worth of pizzas in the past year. They paid $39,000 to employees, paid $11,000 for vegetables and other ingredients, and paid $4,000 in taxes. They began the year with ingredient inventories valued at $1,500 and ended the year with inventories valued at $2,000. What was Pizza Factori’s (and their employees') total contribution to GDP this year (in $)?

Assuming PPP holds and that real exchange rate doesn´t change. Additionally we assume fully mobile internationally capital and consumption growth its the same among countries.

i) Show by using Fisher equation - r(t) = i(t) - E(t) (π (t+1)) that standard expression for Uncovered interest rate parity (UIP) follos from previous assumptions;

ii) Considering a test of UIP with the follow regression: E (e (t+1))- e(t) = α + β (i (t) - i* (t)) + v(t). The i* (t) its given and p*(t) = E(p*(t+1))=0 where p* its the log of the foreign price level and p the domestic prices. The domestic policy makers set i (t) according to a price targeting rule, i(t) = r*(t) + µ p(t) + u(t) where u is serially uncorrelated and independent of v. Demonstrate that β will biased away from 1 if µ its different from zero;

iii) Demosntrate the condition under which β <0.

The bretton woods system was based on which standard

Through the use of an example(s) and correctly labelled diagrams, explain how a change in relative prices affects:
i) relative profits and
ii) resource allocation

you have been assigned as an economist to estimate the consumption function for electric power for household in your country from december 2010 to december 2013 explain the major steps you would adopt in writing the research proposal for this consumption function . in your proposal indicate with reason the type of data you would be relying on to estimate the consumption function

Relate Ricardo’s position on the corn laws to his (a) theory of distribution and (b) theory of comparative costs?

Write down the shapes of ppc when MRS is increasing, decreasing and constant..

1. At a price of $200, a cellphone company manufactures 300,000 units. At a price of $150, the company produces 200,000 phones. What is the price elasticity of supply?
2. Do customers who visit convenience stores at 3 a.m. have a price elasticity of demand that is more or less elastic than those who visit at 3 p.m.? Please explain.

In the Keynesian-cross model, if the MPC equals 0.75, then a $3 billion decrease in taxes increases planned expenditures by ______ and increases the equilibrium level of income by ______

I don’t know how to solve this question. Assistance would be greatly appreciated.

Is the neoclassical, free-market theory necessarily incompatible with dependence theory? How might these two approaches work together?