Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Macroeconomics Expert

1) The Economy cannot be considered fully employed unless the measured unemployment rate is below 1%. Agree or disagree and describe your answer in a paragraph.

2) A) Why will you expect the inflation rate to accelerate if the actual unemployment rate declined to a level lower than the "full employment" unemployment rate and remained at that low level for a year or longer? describe the answer in few sentences.

B) Draw an AS/AD diagram illustrating your answer to part (A). Be sure to label all lines and axes in your diagram clearly.

3) A) Suppose Jean Splicer, an investor, buys $300,000 of shares of stock in a diversified bundle of Bio-tech firms and exactly one year later sells those shares for $315,000. Assume the value of the CPI at the date of Jean's purchase was 180 and rose by the sale date one year later to 190 while the value of the GDP Deflator was 120 at the time of her purchase and rose to 125 by the date she sold her shares. What was Jean’s real rate of return on this investment?

B) Describe why you used either the CPI data or the GDPD data in your answer to part A.

4) A) Assume that several months of data showed the CPI increasing at a 4.5% annual rate due largely to increases in the price of energy and food related commodities following several years when the CPI only increased by 1% per year. Suppose this increase causes investor expectations of annual inflation to also increase from 1% to 4.5%. Assume, at the same time that fears of higher inflation creates concerns that rising interest rates would derail the economic recovery and lead to another recession. Suppose resulting increase in risk aversion among investors drives expected real rate of return need to equate investor demand to existing supply of 1 year Treasury notes down to 0.5 % from 2%. What will you expect to occur to the nominal yields on 1-year T-notes during period over that these changes in inflation expectations and required real yields occurred? (Give a numerical answer if possible) Describe your reasoning.

B) Draw supply/demand diagram of the US Treasury bond market to illustrate the effects on it of the developments cited in part A. (Note: you do not have to include the exact numerical price before and after the change in expectations.) Label the diagram clearly!

5) Between mid 2008 and mid 2009 measured RGDP in the economy fell by 3.8% as the US economy sank into a recession. Over that same time period total employment in terms of hours worked declined by 7% and the unemployment rate rose sharply from 5.8% to 9.4%
What could you infer from this data about the rate of labour productivity growth in the US economy during this period? If possible give a numerical answer, but in any case describe your answer in a few sentences.

6) The $787 billion stimulus package, “American Recovery and Reinvestment Act” passed in Winter 2009 contained a mix of tax rebates, tax credits and increases in several transfer payments (such as extension of unemployment compensation). It also contained funding for a large number of infrastructure spending projects and some funding for scientific research. Most republican legislators voted against the proposed stimulus bill on the grounds that it must have contained more tax cuts and less infrastructure/research spending.

A) Briefly describe the economic rationale for enacting a large fiscal stimulus package, given the macroeconomic condition of the US economy four years ago.

B) describe and contrast the “multiplier effects” on AD of each $1 billion of tax cuts/transfer increases with the “multiplier effects” on AD of each $1billion of increased infrastructure spending. (Which has the larger multiplier effect or are they both the same?) Suppose in both cases that the lower tax rates and higher infrastructure expenditure levels would be phased in over a 2 year period and are assumed to continue indefinitely following that.

Macroeconomics, Economics

  • Category:- Macroeconomics
  • Reference No.:- M91585

Have any Question? 


Related Questions in Macroeconomics

Although there are many different examples of economies in

Although there are many different examples of economies in the world, all of them demonstrate one or more of the four basic types of market structure. For this assignment, in your own words, Identify the four basic marke ...

Assignmentprimary task response within the discussion board

Assignment Primary Task Response: Within the Discussion Board area, write 400-600 words that respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions ...

Why do grocery stores offer coupons think price

Why do grocery stores offer coupons? Think price discrimination.

Topic international tradequestionpromptnbspin 2014 the

Topic: International Trade Question/Prompt:   "In 2014, "the United States exported $2.34 trillion worth of goods and services-an all-time record. Exports from the United States in 2014 equaled the entire gross domestic ...

The affordable care act is expected to help increase access

The Affordable Care Act is expected to help increase access to health care. Health insurance exchanges will be an important part of that. Most people get health insurance through their employers. But people without this ...

Jamal now age 54 lost his job as a ship builder in 1995 his

Jamal (now age 54) lost his job as a ship builder in 1995. His plant never reopened, and he has very specialized skills that are no longer in demand. Jamal's unemployment is best classified as: a. cyclical b. structural ...

Consider vosburg v putney an 1891 wisconsin case putney

Consider Vosburg v. Putney, an 1891 Wisconsin case. Putney, age 11, kicked Vosburg, age 14, in the leg during school. The kick was not very hard - the jury found that "defendant, in touching the plaintiff with his foot, ...

To get you started concentrate on two distinct chapters in

To get you started concentrate on two distinct chapters in the Schiller textbook. See chapter 4 for an analysis of the problems of individual markets. See chapter 10 for an analysis of problems in the aggregation of mark ...

Use at least two 2 of the following arguments from chapter

Use at least two (2) of the following arguments from Chapter 10 in your paper: normative, positive, anecdote, and evidence arguments to present your positions. Clearly label these to receive credit.

Economic choice and economic decision makingeconomic choice

Economic Choice And Economic Decision Making Economic Choice and Economic Decision Making Consider your last vehicle purchase and the decision making process you engaged in while deciding what vehicle to purchase or if a ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro