Problem 1: What are the three primary measures used in macroeconomics to assess the performance of an economy? Define each measure.
Problem 2: Describe the difference between real GDP and nominal GDP.
Problem 3: Identify at least four important policy questions about the powers and limits of government economic policy that macroeconomics models are able to answer.
Problem 4: Define saving.
Problem 5: Define investment.
Problem 6: What accounts for differences in living standards between rich and poor countries today?
Problem7: (Consider This) What is the difference between economic investment and financial investment? Give an example for each type of investment.
Problem 8: What are demand shocks?
Problem 9: What are supply shocks?
Problem10: (Consider This) Which took the major brunt of the decline in total demand in the Great Recession, real output or prices?
Problem 11: Explain sticky prices, according to economists.
Problem 12: Describe two reasons why businesses hesitate to change prices.
Problem 13: Watch the following movie trailer and explain how the movie relates to demand, supply and prices (hint: see question number 8):
YouTube Video: Jingle All the Way Trailer [HQ]