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Macroeconomics
A Company is operating on perfectly competitive markets and wants to maximize its profits. Assume that HSG uses the production function Y = ALα with A = 2 and α = 0.5. The real wage w is 4. What is the optimal value of labor L that should be employed?
Macroeconomics
The FE curve depicts all combinations of the nominal exchange rate and GDP that guarantee an equilibrium on the FE market.
Macroeconomics
The table shows a bank balance sheet. The desired ratio on the deposits is 5 %. There is no currency drain. What is the quantity of loans and the quantity of total deposit when the bank has no excess reverses.
reverses at the Fed= 25 checkabledeposits=105
cash in vault=10
securities= 60 saving deposits=95
loans= 105
reverses at the Fed= 25 checkabledeposits=105
cash in vault=10
securities= 60 saving deposits=95
loans= 105
Macroeconomics
Hi! I have a question
I'm currently studying for economics o level and I was doing some past papers
In one, the question was "In 2011, the US government declared that the country must increase the manufacture of fuel from crops such as corn that have previously only been used for food. What is likely to happen in the market for corn?"
The options were
A) a movement along the demand curve for corn
B) a movement along the supply curve for corn
C) a shift to the left in the demand curve for corn
D) a shift to the right in the demand curve for corn
naturally, knowing that movements along the curve were only caused by price factors, I picked D... however, the answer was B... can you explain why?
I'm currently studying for economics o level and I was doing some past papers
In one, the question was "In 2011, the US government declared that the country must increase the manufacture of fuel from crops such as corn that have previously only been used for food. What is likely to happen in the market for corn?"
The options were
A) a movement along the demand curve for corn
B) a movement along the supply curve for corn
C) a shift to the left in the demand curve for corn
D) a shift to the right in the demand curve for corn
naturally, knowing that movements along the curve were only caused by price factors, I picked D... however, the answer was B... can you explain why?
Macroeconomics
Can you thoroughly explain the effects of an increase in unemployment benefits on the position of the AD and As curves in the short and medium run? Plus, I have no idea why that moves the LM curve. Can you explain why? please...
Macroeconomics
Imagine the following open economy: C = 50 + 0.75YD, I = 50 0.5i, t = 0.1, G = 100, Im = 0.1Y , Ex = 100. Calculate the slope of the IS curve.
(a) slope of the IS curve = ...
(a) slope of the IS curve = ...
Macroeconomics
What is assumed in the Mundell-Fleming model about goods prices? (several answers can be correct)
(a) They are fixed because the economy is operating below its full capacity.
(b) They are fixed because the economy is operating at its full capacity.
(c) They are flexible because the economy is operating at its full capacity.
(d) There are no assumptions about the goods prices because the model does not treat them explicitly.
(a) They are fixed because the economy is operating below its full capacity.
(b) They are fixed because the economy is operating at its full capacity.
(c) They are flexible because the economy is operating at its full capacity.
(d) There are no assumptions about the goods prices because the model does not treat them explicitly.
Macroeconomics
An equilibrium in the Mundell-Fleming model implies that (Several answers possible)... (a) the goods market is in equilibrium.
(b) the labor market is in equilibrium.
(c) the money market is in equilibrium.
(d) the balance of payments is zero without government/central bank intervention.
(b) the labor market is in equilibrium.
(c) the money market is in equilibrium.
(d) the balance of payments is zero without government/central bank intervention.
Macroeconomics
Imagine a Mundell-Fleming economy with fully immobile capital and mark the correct state- ments.(several answers correct)
(a) Fiscal policy is ineffective in boosting the economy in a fixed exchange rate regime. (b) Fiscal policy is effective in boosting the economy in a flexible exchange rate regime.
(c) Monetary policy is effective in boosting the economy in a flexible exchange rate regime. (d) Monetary policy is ineffective in boosting the economy in a fixed exchange rate regime.
(a) Fiscal policy is ineffective in boosting the economy in a fixed exchange rate regime. (b) Fiscal policy is effective in boosting the economy in a flexible exchange rate regime.
(c) Monetary policy is effective in boosting the economy in a flexible exchange rate regime. (d) Monetary policy is ineffective in boosting the economy in a fixed exchange rate regime.
Macroeconomics
Mark correct statements about monetary policy in the Mundell-Fleming model with fully mobile capital.(several answers possible)
(a) Monetary policy is not effective in fixed exchange rate regimes because of the need of sterilization of monetary interventions.
(b) Monetary policy is not effective in fixed exchange rate regimes because of the limited reaction of foreign investment.
(c) Monetary policy is effective in the flexible exchange rate regime because money supply can be determined exogenously.
(d) The effectiveness of monetary policy is not limited by the liquidity trap.
(a) Monetary policy is not effective in fixed exchange rate regimes because of the need of sterilization of monetary interventions.
(b) Monetary policy is not effective in fixed exchange rate regimes because of the limited reaction of foreign investment.
(c) Monetary policy is effective in the flexible exchange rate regime because money supply can be determined exogenously.
(d) The effectiveness of monetary policy is not limited by the liquidity trap.
