Macroeconomics Answers

Indicate whether you agree and disagree with the following statements. Note that you need to write the justification that support your response.

1. Monetary policy has an impact on output and price in monetarism school of thought

 Indicate whether you agree and disagree with the following statements. Note that you need to write the justification that support your response.

1.      Monetary policy has an impact on output and price in monetarism school of thought 

Plot the equation: Y=5-2X  and Y=2+ 3X in the same graph. Identify the equilibrium value for Y and X.

a) Given a utility function

u = x_{1} ^ 0.5 * x_{2} ^ 0.25

If P_{1} = 2 and P_{2} = 4 and Y=100, compute optimal X_{1} and X_{2} that will maximize utility

Suppose that government of Pakistan gives soft loans to producer.how would You expect such a change to affect output, employment and the real wages in the classical model

Solve the following problems, showing all of your calculations .

Assume the following:

GDP (Y) = 5,000

• C (consumption)= 750 + 0.5(Y-T).
• I (investment)= 1500 – 50r, where r is the real rate of interest in percent.
• T (taxes)= 1,250
• G(government spending) = 1,125

1.    What are the equilibrium values of C, I and r?
2. A technical innovation increases investment to the function I = 2,000 - 50r. What are the new equilibrium values of C, I, and r?

quantitative easing effect on economic activity

For the following total-revenue and total-cost functions of a firm:

TR = 22Q - 0.5Q ^ 2 ,

TC=\ Q^ 2 -8.5Q^ 2 +50Q+90

(a) Determine the level of output at which the firm maximizes its total profit. (b) Determine the

A firm's total-revenue and total-cost functions are

TR=4Q

TC=0.040¹-0.90³ + 100+5

(a) Determine the best level of output. b) Determine the total profit of the firm at its

What are the the effects of an expected future increase in taxes on the current national savings, investment, and the interest rate? Using the saving - investment diagram (graph) to analyze.