9 Short Answer/Problems/Essays 1. The following table shows the quantities of co
ID: 1177135 • Letter: 9
Question
9 Short Answer/Problems/Essays
1. The following table shows the quantities of corn supplied and demanded at different prices.
What are the equilibrium price and quantity of corn? At a price of $80, is there an excess demand or supply? By how many?
2. The table below uses data for the year 2011 provided by the Bureau of Labor Statistics and adjusted to be comparable to U.S. data. All values are in thousands. Fill in the blank entries in the table.
3. Compute how much each of the following items is worth in terms of 2012 dollars using 178 as the price index for 2012.
A) In 1946, the CPI was 16.7 and the price of a movie ticket was $0.30.
B) In 1952, the CPI was 25.1 and an engineer earned $40.00 a day.
C) In 1963, the CPI was 49.4 and a gallon of gas cost $0.45.
4. Assume the following open economy for Questions 1a, 1b, 1c and 1d below:
C = 200 + 0.75(Y %u2013 100)
I = 130
G = 200
X =95
M = 115
A) Determine (solve for) the equilibrium level of income or GDP (Y).
B) Determine the impact on income of a 50 increase in government spending from 200 to 250.
C) If the government seeks to increase income by 40, how much should it raise government spending?
5. Explain how the economy moves back to full employment from recession. Be sure to detail what happens to short-run aggregate supply, unemployment, equilibrium GDP and the price level.
6. Workers at a local mining company are paid $25.60 per hour, and they have incorporated a 3 percent annual raise in their contracts to account for expected inflation. Explain how unexpected inflation of 5 percent will affect the real wage and the unemployment rate.
7. If net taxes rise by $150 billion would you expect household saving to fall by $150 billion, by more than $150 billion, or by less than $150 billion?
8. The reasons why someone cannot get a job are similar to the reasons why someone cannot get a date. Using the ideas of frictionally unemployed, structurally unemployed, and cyclically unemployed, describe and explain how a student at your university might be frictionally undated, structurally undated, and cyclically undated.
9. A central concept in macroeconomics is the idea of the natural rate of unemployment. Why does it make sense to define full employment to occur when the unemployment rate equals the natural rate of unemployment, instead of when the unemployment rate equals zero? Elaborate and explain carefully.
Explanation / Answer
1. the equilibrium price: $90 per ton and quantity: 900
there is excess demand: 1200-700=500
2. Labor Force of Japan: 81010
Employed of USA:134723
Unemployment Rate: Japan:10.49% USA:8.00%
Labor-Force Participation Rate:USA:71.34% Japan:58.10%
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