Mock Exam Solutions - Topics 4-6
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Catégorie :Category: nCreator TI-Nspire
Auteur Author: acidphoenix
Type : Classeur 3.0.1
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Mis en ligne Uploaded: 07/11/2024 - 23:39:01
Uploadeur Uploader: acidphoenix (Profil)
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Visibilité Visibility: Archive publique
Shortlink : http://ti-pla.net/a4303148
Type : Classeur 3.0.1
Page(s) : 1
Taille Size: 3.53 Ko KB
Mis en ligne Uploaded: 07/11/2024 - 23:39:01
Uploadeur Uploader: acidphoenix (Profil)
Téléchargements Downloads: 2
Visibilité Visibility: Archive publique
Shortlink : http://ti-pla.net/a4303148
Description
Fichier Nspire généré sur TI-Planet.org.
Compatible OS 3.0 et ultérieurs.
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Question 1 Suppose that we have the following information: C = 250 + 0.75Yd | Yd = Y - T I = 150 | AE = C + I + G + NX G = 100 | spending multiplier = 1/(1 slope AE) T = 80 | tax multiplier = -mpc/(1 mpc) EX =175 IM = 150 (a) Determine the aggregate expenditure equation. AE = C + I + G + NX AE = 250 + 0.75(Y T) + 150 + 100 + 175 150 AE = 525 + 0.75(Y 80) AE = 525 + 0.75Y 60 AE = 465 + 0.75Y (b) Determine the autonomous aggregate expenditure. Autonomous AE = 465 (c) Determine the induced aggregate expenditure. Induced AE = 0.75Y (d) Assume that Real GDP = $2,100. What would the unplanned change in inventories be equal to? AE = 465 + 0.75Y AE = 465 + 0.75(2100) = 2040 Real GDP (Y) = 2100 Y > AE So unplanned inventory increase occurred Unplanned change = Actual Planned = 2100 2040 = 60 (e) Find the equilibrium value for real GDP. Y = AE Y = 465 + 0.75Y 0.25Y = 465 Y = 1860 2 (f) Determine the value of consumption and savings when the economy is in equilibrium. C = 250 + 0.75(Y T) C = 250 + 0.75(1860 80) = 1585 S = Y C T = 1860 - 1585 - 80 = 195 OR S = -250 + 0.25(Y T) S = -250 + 0.25(1860 80) = 195 TO PLOT ON GRAPH: Y-intercept = 465 Equilibrium point = (1860, 1860) AE line increasing (positive slope) Question 2 (a) Government survey takers determine that typical family expenditures each month in the year designated as the base year are as follows: 20 pizzas at $10 each Rent of apartment, $600 per month Gasoline and car maintenance, $100 Phone service (basic service plus 10 long-distance calls), $50 In the year following the base year, the survey takers determine that pizzas have risen to $11 each, apartment rent is $640, gasoline and maintenance have risen to $120, and phone service has dropped in price to $40. (i) Find the CPI in the subsequent year. " Cost of basket base year = (20*10) + (600*12) + (100*12) + (50*12) " Cost of basket base year = 200 + 7200 + 1200 + 600 = 9200 " Cost of basket following year = (20*11) + (640*12) + (120*12) + (40*12) " Cost of basket following year = 220 + 7680 + 1440 + 480 = 9820 " CPI = cost of basket current / cost of basket base year * 100 " CPI = 9820 / 9200 * 100 = 106.7 (ii) Find the rate of inflation between the base year and the subsequent year. " Inflation = (CPI current - CPI previous)/ CPI previous * 100 " Inflation = (106.7 - 100)/ 100 * 100 = 6.7% (iii) The familys income rose by 5 percent between the base year and the subsequent year. Are they worse off or better off in terms of what their income is able to buy? Explain. " Income increased by 5% " Inflation increased by 6.7% " They are worse off as income did not increase by the same amount as inflation. " Loss of purchasing power as income can now buy less. 4 (b) True or False: If both the potential lender and the potential borrower correctly anticipate the rate of inflation, inflation will not redistribute wealth from the creditor to the debtor. Explain. " True " As creditor will accurately determine what real rate of interest they want to earn. (a) True/False (make sure you say True or False): In order to help reduce structural unemployment the government should fund a community-wide job fair. Explain. " False " Job fair will match job to skill so reduce frictional unemployment. " Structural unemployment occurs if skill is obsolete (no longer needed). To reduce structural unemployment would require re-training. (b) Bill Summers is running for mayor of your town. His slogan is, Vote for Bill! Ill make the unemployment rate zero! Explain why this is a foolish slogan. " No, I do not agree. " Economy will always have some level of frictional and structural unemployment. " Natural rate of unemployment (long run unemployment) is between 4 5%. Made with nCreator - tiplanet.org
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Compatible OS 3.0 et ultérieurs.
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Question 1 Suppose that we have the following information: C = 250 + 0.75Yd | Yd = Y - T I = 150 | AE = C + I + G + NX G = 100 | spending multiplier = 1/(1 slope AE) T = 80 | tax multiplier = -mpc/(1 mpc) EX =175 IM = 150 (a) Determine the aggregate expenditure equation. AE = C + I + G + NX AE = 250 + 0.75(Y T) + 150 + 100 + 175 150 AE = 525 + 0.75(Y 80) AE = 525 + 0.75Y 60 AE = 465 + 0.75Y (b) Determine the autonomous aggregate expenditure. Autonomous AE = 465 (c) Determine the induced aggregate expenditure. Induced AE = 0.75Y (d) Assume that Real GDP = $2,100. What would the unplanned change in inventories be equal to? AE = 465 + 0.75Y AE = 465 + 0.75(2100) = 2040 Real GDP (Y) = 2100 Y > AE So unplanned inventory increase occurred Unplanned change = Actual Planned = 2100 2040 = 60 (e) Find the equilibrium value for real GDP. Y = AE Y = 465 + 0.75Y 0.25Y = 465 Y = 1860 2 (f) Determine the value of consumption and savings when the economy is in equilibrium. C = 250 + 0.75(Y T) C = 250 + 0.75(1860 80) = 1585 S = Y C T = 1860 - 1585 - 80 = 195 OR S = -250 + 0.25(Y T) S = -250 + 0.25(1860 80) = 195 TO PLOT ON GRAPH: Y-intercept = 465 Equilibrium point = (1860, 1860) AE line increasing (positive slope) Question 2 (a) Government survey takers determine that typical family expenditures each month in the year designated as the base year are as follows: 20 pizzas at $10 each Rent of apartment, $600 per month Gasoline and car maintenance, $100 Phone service (basic service plus 10 long-distance calls), $50 In the year following the base year, the survey takers determine that pizzas have risen to $11 each, apartment rent is $640, gasoline and maintenance have risen to $120, and phone service has dropped in price to $40. (i) Find the CPI in the subsequent year. " Cost of basket base year = (20*10) + (600*12) + (100*12) + (50*12) " Cost of basket base year = 200 + 7200 + 1200 + 600 = 9200 " Cost of basket following year = (20*11) + (640*12) + (120*12) + (40*12) " Cost of basket following year = 220 + 7680 + 1440 + 480 = 9820 " CPI = cost of basket current / cost of basket base year * 100 " CPI = 9820 / 9200 * 100 = 106.7 (ii) Find the rate of inflation between the base year and the subsequent year. " Inflation = (CPI current - CPI previous)/ CPI previous * 100 " Inflation = (106.7 - 100)/ 100 * 100 = 6.7% (iii) The familys income rose by 5 percent between the base year and the subsequent year. Are they worse off or better off in terms of what their income is able to buy? Explain. " Income increased by 5% " Inflation increased by 6.7% " They are worse off as income did not increase by the same amount as inflation. " Loss of purchasing power as income can now buy less. 4 (b) True or False: If both the potential lender and the potential borrower correctly anticipate the rate of inflation, inflation will not redistribute wealth from the creditor to the debtor. Explain. " True " As creditor will accurately determine what real rate of interest they want to earn. (a) True/False (make sure you say True or False): In order to help reduce structural unemployment the government should fund a community-wide job fair. Explain. " False " Job fair will match job to skill so reduce frictional unemployment. " Structural unemployment occurs if skill is obsolete (no longer needed). To reduce structural unemployment would require re-training. (b) Bill Summers is running for mayor of your town. His slogan is, Vote for Bill! Ill make the unemployment rate zero! Explain why this is a foolish slogan. " No, I do not agree. " Economy will always have some level of frictional and structural unemployment. " Natural rate of unemployment (long run unemployment) is between 4 5%. Made with nCreator - tiplanet.org
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