宏观经济学期末复习(2)

d) People hold equal amounts of currency and demand deposits.Bankshold 20 percent of deposits asreserves.

e) The central bank decides to increase the money supply by 10

percent.Ineach of the above four scenarios, how much should it increase themonetarybase?

Chapter5

MV=PY

dM/M+dV/V=dP/P+dY/YQ:

Suppose a country has a money demand function (M/P)d??kY,where kis a constant parameter .The money supply grows by

12percentper year, and real income grows by 4 percent peryear.

a) What is the average inflationrate?

b) How would inflation be different if real income growth werehigher?Explain.

c) How do you interpret the parameter k? What is its relationship tothevelocity ofmoney?

d.) Suppose, instead of a constant money demand function, the

velocityofmoney in this econ- omy was growing steadily because of financialinnovation.How would that affect the infla- tion rate?Explain.

Q: Suppose that the money demand function takes the form(M/P)d

??L(i,Y) ??Y/(5i)

a) If output grows at rate g, at what rate will the demand for realbalancesgrow (assuming constant nominal interestrates)?

b) What is the velocity of money in thiseconomy?

c.)If inflation and nominal interest rates are constant, at what rate, if any,willvelocitygrow?

d.) How will a permanent (once-and-for-all) increase in the level

ofinterestrates affect the level of velocity? How will it affect the subsequent growthrateofvelocity?

Chapter6

2. Consider an economy described by the follow- ingequations:

Y?C?I?G?NX,

Y ??5,000,

G ??1,000, T ??1,000,C??250 ??0.75(Y ??T),I ??1,000 ??50r, NX ??500 ??500, r??r????5.

a.) In this economy, solve for national saving, investment, the tradebalance,and the equilibrium exchangerate.

b)Suppose now that G rises to 1,250. Solve for national saving,

investment,thetrade balance, and the equilibrium exchange rate. Explain what youfind.

c.)Now suppose that the world interest raterises from 5 to 10 percent. (Gisagain 1,000.) Solve for national saving, investment, the trade balance, andtheequilibrium exchange rate. Explain what youfind.

3. The country of Leverett is a small open economy. Suddenly, a changeinworld fashions makes the exports of Leverettunpopular.

a. What happens in Leverett to saving, invest- ment, net exports, theinterestrate, and the exchangerate?

b. The citizens of Leverett like to travel abroad. How will this change intheexchange rate affectthem?

c. The fiscal policymakers of Leverett want to adjust taxes to

maintaintheexchange rate at its previous level. What should they do? If they do this,whatare the overall effects on saving, investment, net exports, and the interestrate?

6.ACaseStudyinthischapterconcludesthatifpoornationsofferedbetter

production efficiency and legal protections, the tradebalance in rich nations such as the United States would move towardsurplus.Let’s consider why this might be thecase.

a) If the world’s poor nations offer better production efficiency andlegalprotection, what would happen to the investment demand function inthosecountries?

b) How would the change you describe in part (a) affect the demandforloanable funds in world financialmarkets?

c) How would the change you describe in part (b) affect the worldinterestrate?

d) How would the change you describe in part (c) affect the tradebalancein richnations?

Chapter7

5. Consider an economy with the following Cobb–Douglasproductionfunction:

Y =K1/3L2/3.

The economy has 1,000 units of capital andalabor force of 1,000workers.

a) Derive the equation describing labor demand in this economy as

afunctionof the real wage and the capital stock. (Hint: Review Chapter3.)

b) If the real wage can adjust to equilibrate labor supply and

labordemand,what is the real wage? In this equilibrium, what are employ- ment, output,andthe total amount earned byworkers?

c) Now suppose that Congress, concerned about the welfare of theworkingclass, passes a law requiring firms to pay workers a real wageof one unitofoutput. How does this wage compare to the equilibriumwage?

d) Congress cannot dictate how many workers firms hire at the

mandatedwage.Giventhis fact, what are the effects of this law? Specifically, what happenstoemployment, output, and the total amount earned byworkers?

e) Will Congress succeed in its goal of helping the workingclass?Explain.

f) Do you think that this analysis provides a good way of thinkingabouta minimum- wage law? Why or whynot?

6. Suppose that a country experiences a reduction in productivity—that is,anadverse shock to the productionfunction.

a. What happens to the labor demandcurve?

b. How would this change in productivity affect the labor market—

thatis,employment, unemployment, and real wages—if the labor market is alwaysinequilibrium?

c. How would this change in productivity affect the labor market ifunionsprevent real wages fromfalling?

Chapter 89 1. consider k 1) s.s

2) goldenrole

3) starting with too much capital