Macroeconomics Answers

The actual or real world money multiplier is generally less than the simple money multiplier. Indicate whether the statement is TRUE or FALSE; and then provide support for your answer.

The Nottinghamshire Research Observatory in England calculated that students who attend Nottingham Technical University spend about £2,760 each in the local economy for a total of £50.45 million. In total, the impact of their spending on the local economy is £63 million. Calculate the size of the student spending multiplier.

Suppose a gasoline station offers the following promotion on the 4th of
July: "TODAY ONLY: FREE GASOLINE FROM NOON UNTIL 3:00 P.M.!
APPY BIRT DAY, AMERICA!" Is that gasoline a free good to the
owner of the station? Is it a free good for all the drivers who wait in long
lines to fill up? Countless others might decide to avoid the "free" gas and
fill up at other stations that charge $4.00 per gallon. In your opinion, are
they foolish to pass up the opportunity? In the economic way of thinking,
would they be failing to economize?

Are you more or less likely to study on a Friday night or a Monday night? Explain this using the term opportunity cost.

Go to the Bureau of Economic Analysis at this Web site, and look up the latest new release for real GDP. Address the following questions after reading the latest release:

Where is the United States in the business cycle?
What is the real GDP today?
What is the largest component of GDP?
What is the smallest component of GDP?
What is the fastest growing component of GDP, and why?
What components of GDP were involved in the change from last month to this month?
What is the price index today?
What caused the change

The Cowtown Hotel is the only first-class hotel in Fort Worth. The hotel owners hired economics advisors for advice about improving the hotel’s profitability. They suggested it could increase this year’s revenue by raising prices. The owners asked, “Won’t raising prices reduce the quantity of hotel rooms demanded and increase vacancies?” What do you think the advisors replied? Why would they suggest increasing prices?

In each of the following cases, indicate which good you think has a relatively more price elastic demand and identify the most likely reason, in terms of the determinants of the elasticity of demand (more substitutes, greater share of budget, or more time to adjust).a. cars or Chevrolets b. salt or housing c. food or rice d. natural gas this month or over the course of a year

FED increases the ammount of money
1) is there a difference in the composition of national income before and after the aply of this policy?

What is the basis for the argument that GDP measures fail to include many things that are part of human welfare?

Consider a market of MP3 players. List one or two events related with this market which will cause the following results.a. an increase in both equilibrium price and quantity of MP3 players.b. an decrease in both equilibrium price and quantity of MP3 players.c. an increase in equilibrium price and a decrease in equilibrium quantity.d. a decrease in equilibrium price and an increase in equilibrium quantity.