43. Which of the following variables does NOT cause business cycles, according to classical economics? (A) Technological growth. (B) Immigration. (C) Capital accumulation. (D) Money supply.
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- 1. Which of the following question is one of the most interest for macroeconomics. (a). Why do foreigners immigrate to Ghana (b).What is the appropriate stance of antitrust policy (c).Why is there inflation ? (d). Which does the steel industry wants tarrifs ? 2. Which of the following statement is true ? (a). Final goods are produce in the same year as the reflected final good, whereas caital goods are produce in different year. (b). Capital goods are produced one year and final good are produced over a period of more than one year. (c). Intermidiate goods are typed of capital goods. (d). Capital goods are not final goods because they are used up in the same period in which they are produce.Practice Your Knowledge of Business Cycles. Explain each of your choices. (A) For two straight quarters, business inventories increase at a sharp rate. This most likely indicates * an expanding economy * a recovering economy the beginning of * a recession an increase in inflation * a record unemployment rate (B) At which point in the business cycle is there the largest inflationary gap? * The peak *The trough * During expansion During contraction * At full employment (C) If the consumer price index begins to increase dramatically, which of the following is likely true? * The output gap is positive and near the peak. * The output gap is positive and near the trough. * There is no output gap and the economy is growing. * The output gap is negative and near the peak. The output gap is negative and near the trough.1. Consider labor market in an economy. In a classical model, you can think that each worker comes with one unit of effort. In a Keynesian model effort makes a difference. Suppose that the efficiency wage is above labor market equilibrium. (a) Draw a graph where you can show both employment and unemployment predicted by each model. Discuss unemployment under both models. (b) Now suppose a negative productivity shock hits the economy. How would employment and unemployment change under both Classical and Keynesian model. Show your results on a graph. (c) When the economy is hit by a negative productivity shock, workers are worried about their jobs and they start working harder, that is they increase their effort from two to three. (Note that in the Classical model this is not possible. their effort level is still unity.) How would this affect employment, unemployment and output in the Keynesian model? (d) This time, suppose there is a positive productivity shock. Draw a graph and show…
- 21. What you mean by business cycles? What are their consequences? 22. All industrialized countries have become "service economies" in recent decades. Explain the reasons behind this shift. 25. Draw a production possibilities frontier for an economy, with the axes labeled "military goods" and "peace goods." Indicate the region that is attainable and the region that is not. Explain the shape of the curve-what assumptions did you make in drawing it? 26. Why is it inefficient for an economy to be inside the production possibilities frontier? 27. What is an aggregate? How is it used in macroeconomics? Give two examples of specific aggregates that are used in the study of macroeconomics. 28. What are the two basic principles of aggregation? 29. What is Gross Domestic Product? What is included in this statistic? What is excluded? Give two examples of goods or services that are included in GDP and two examples of goods or services that are excluded. 30) Which of the following items are…) Over the period 1960-2000, France grew ________ than the United States economy A) 2 % slower. B) 2% faster. C) more than 2% slower. D) less than 2% faster. E) more than 2% faste1. Which of the following is not an assumption of the simple Keynesian model ? (a). We are in the short -run (b).Prices are constant (c).Output is demand -determine (d). Output is supply -determine (e). Aggregate output equals planned expenditure. 2. Which of the following is not one of the principal economic goals for the economy ? (a). Economic growth (b).Stable prizes (c). Strong national defense (d). Full employment (e). A strong cedi 3. Which is not a cause for business cycles considered by macroeconomists. (a). Greed (b) variations in optimism (c) shocks to money supply (d) shocks to technological ability 4. Which of the following question is of most interest for macroeconomics. (a). Why do foreigners immigrate to Ghana. (b).What is the appropriate stance of antitrust policy (c)Why is there inflation (d). What does the steel industry wants to tariffs 5. Which of the following statement is true ? (a). Final goods as produce in the same year as the related final good…
- No written by hand solution An economist needs to predict the real wage rate, employment, output, real interest rate, consumption, investment, and price level. The economy is hit with a shock, which the economist thinks is a temporary adverse supply shock. (a) If you were the economist, what would be your forecasts for each of the variables listed above (rise, fall, and no change) in general equilibrium? (b) What if the shock was due to people's reduced expectations about their future income? Which variables did you forecast correctly, and which did you forecast incorrectly in part (a)?3. The Black Death: In the middle of the fourteenth century, an epidemic known as the Black Death killed about a third of Europe's population, about 34 million people. While this was an enormous tragedy, the macroeconomic consequences might surprise you: over the next century, wages are estimated to have been higher than before the Black Death. (a) Use the production model to explain why wages might have been higher. (b) Can you attach a number to your explanation? In the model, by how much would wages rise if a third of the population died from disease?During an economic expansion, real GDP ____ and unemployment ____.(a)increases, increases(b)increases, decreases(c)decreases, increases(d)decreases, decreases
- 1. (i) Which of the following is not true of the Keynesian model? Select one: A. The wage bargain is struck in terms of money wages. B. An increase in the expected price level would cause labour supply to decline. C. Imperfect information about prices explains fluctuations in output and employment. D. Price expectations are essentially forward-looking. E. An increase in the money wage for a given value of the expected price level would increase labour supply. (ii) Which of the following statement is not true? Select one: A. If money demand is completely interest insensitive, the LM curve is vertical. B. An increase in money demand for speculation shifts the LM schedule to the left. C. In the liquidity trap situation, increments to wealth would be held in the form of money. D. Keynes assumes that investors have a relatively fixed conception of the critical interest. rates E. A shift in the money demand function is also known as a shift in liquidity preference.Question: COVID-19 all around the world has restricted the economic activity. To stop the spread of the virus Pakistan like many other countries adopted the policy of smart lockdown. Shutting down of the industry has created adverse supply shock in the economy. While, the slowdown in business and economic activities the country is in the recessionary phase of the business cycle as the GDP growth for the FY 2020-21 is expected to be -0.2 accompanied by high unemployment and poverty rate.a. Reflecting on the above situation justify whether the State Bank of Pakistan should opt for easy or tight monetary policy as a stabilization policy. Also illustrate it graphically. b. Reflecting on the above situation justify whether the Government of Pakistan should opt for expansionary or contractionary fiscal policy as a stabilization policy. Also illustrate it graphically.16. Which of the following is NOT a goal of Klaus Schwab's Great Reset program? (A) National sovereignty. (B) Green technology. (C) Stakeholder capitalism. (D) A digital passport. 17. Which of the following is NOT a likely reason for supply shortages in 2021? (A) COVID-19 lockdowns and restrictions. (B) Transport legislation. (C) Government handouts (like CERB). (D) Stock market disruptions. 18. Why does Employment Insurance cause unemployment? (A) It increases the price of labour by mandating a minimum. (B) It incentivizes the unemployed to remain so. (C) It reduces the demand for labour. (D) It releases currency into the economy. 19. Which of the following policies does NOT increase structural unemployment? (A) Shutting down job-matching centres. (B) Vaccine mandates at workplaces. (C) Replacing human professors with online AI teachers. (D) Minimum wages. 20. Which of the following assets is the most liquid? (A) Stocks. (B) Residential real estate. (C) Gold. (D) Yachts.