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However, many richer economies have little land or land of poor quality. How can a country with little land or unproductive land become rich?
Sources of Inflation Using the concepts of aggregate supply and aggregate demand, explain why inflation usually increases during wartime.
What would be the size of the U.S. labor force? If 85 million adults are not working, what is the unemployment rate?
What role do inventories play in determining real GDP demanded? Suppose initially that firms are either producing more than people plan to spend, or producing.
What equalities hold at the level of real GDP demanded? When determining real GDP demanded, what do we assume about the price level?
Real GDP Demanded In your own words, explain the logic of the income-expenditure model. What determines the amount of real GDP demanded?
What are the components of aggregate expenditure? In the model developed in this chapter, which components vary with changes in the level of real GDP?
What factors are assumed constant along the net export function? What would be the impact on net exports of a change in real disposable income?
What impact does the behavior have on the saving rate in the overall economy? What impact does this behavior have on an individual's lifetime consumption?
A number of factors can cause the consumption function to shift. What, if anything, happens to the saving function when the consumption function shifts?
Why Does Global Economic support the concept of economic convergence or not?
Traditionally, why do Canada and Europe experience slower productivity growth after a recession than does the U.S.?
What are some examples of new technology that have created job? How do you think you might measure the net impact of technological change on overall employment?
Anticipated Versus Unanticipated Inflation If actual inflation exceeds anticipated inflation, who will lose purchasing power and who will gain?
Which had problems with high inflation, the increased use of another country's currency (such as the U.S. dollar or South African rand) became common.
Explain why most experts believe that official U.S. data underestimate the actual rate of unemployment.
Can you offer any reasons why rates on average have differed across major economies during the last three decades?
How would a more generous unemployment insurance system affect the full employment figure?
In addition, because of the improving economic conditions, the labor force increases by 200,000. Would the unemployment rate go up or down?
Unemployment in Various Groups Does the overall unemployment rate provide an accurate picture of the impact of unemployment on all U.S. population groups?
Why do you suppose the portion of final goods expenditures that goes to pay for intermediate good or raw material is excluded from income method of calculation?
Define fiscal policy. Determine whether each of the following, other factors held constant, would lead to an increase, a decrease.
Suppose first that 2 cannot pay the firm not to store waste, and that the competitive price for storage is 1. Compute the Walrasian equilibrium
What are the Pareto optimal levels of effort (this maximizes total surplus from production minus the costs of effort)?
What are some of the economic consequences of global warming? What kind of market failures does this predict?