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Economists have identified two kinds of macroeconomic expectations. What are the implications for macroeconomic policy of these two forms of expectations?
Give two reasons why there may be a short-run tradeoff between unexpected inflation and the unemployment rate.
Which countries have their monetary policy made by the ECB? How is the ECB different from the Federal Reserve?
If the Fed now purchases $500 worth of government bonds from private bond dealers, what are excess reserves of the banking system?
Why do you demand money? What determines how much money you keep in your pocket, purse, or bank accounts?
Which sector spends the most? Which sector spends the least? Which sector, because of volatility, has importance greater than is warranted by its size?
Why does the value of output always equal the income received by the resources that produced the output? What does it mean if net exports are negative?
Discuss what is the fundamental problem associated with overfishing of the oceans? What might lead to underfishing?
Discuss what government policies might be used to reduce poverty most effectively? Explain what is meant by the term discrimination.
What would it mean if the poverty income level of US were applied to Mexico? Why does the health of the economy affect the number of people living in poverty?
How does an increase in foreign income affect domestic aggregate expenditures and demand? Draw a diagram to illustrate your answer.
Discuss how is the short run different from the long run? Draw an aggregate demand and supply diagram f Japan.
Draw a short-run aggregate supply curve that gets steeper as real GDP rises. Explain why the curve has this shape.
How does a decrease in foreign price levels affect domestic aggregate expenditures and demand? Draw a diagram to illustrate your answer.
Why does the aggregate demand curve slope down? Give real-world examples of the three effects that explain the slope of the curve.
Explain what a current account deficit (negative net exports) means in terms of domestic spending, production, and borrowing.
If the U.S. dollar appreciated against the euro, what would you expect to happen to U.S. net exports with Germany?
Why has nominal GDP increased faster than real GDP in United States over time? What would it mean if an economy had real GDP increasing faster than nominal GDP?
What is the GDP for this economy? What is the GNP for this economy? What is the NNP for this economy? What is the national income for this economy?
Why are there so many sole proprietorships? Why is the revenue of the average sole proprietorship less than that of the typical corporation?
Explain why total expenditures and national output may rise after the quota is imposed. Who is likely to benefit from the quota? Who will be hurt?
If households want to save and thus do not use all of their income for consumption, what will happen to total spending?
People sometimes argue that imports should be limited by government policy. Explain why total expenditures and national output may
What are the net exports of countries A, B, and C? Which country is running a trade deficit? A trade surplus?
Which hotel room is cheaper to a U.S. tourist? What is the exchange rate between the euro and the British pound?