New Semester Started Get 50% OFF Study Help! --h --m --s Claim Now

Question Answers

Textbooks

Find textbooks, questions and answers

Oops, something went wrong!

Change your search query and then try again

Result Not Found

Books FREE
Study Help
Tutors
AI Study Planner NEW
Sell Books

Search
Sign In
Register

study help
business
micro economics

Economics 6th edition R. Glenn Hubbard - Solutions

Firms care about their after-tax rate of return on investment projects. In the market for loan able funds, draw a graph and explain the effect of an increase in taxes on business profits. (For simplicity, assume no change in the federal budget deficit or budget surplus.) What happens to the
A writer for the Wall Street Journal wrote a whimsical "Letter to Stingy American Consumers": Dear American Consumer: This is The Wall Street Journal. ...The sun shined in April and you didn't spend much money. ... You've been saving more too. ... This saving is not like you. ... Do you know the
The Making the Connection claims that Ebenezer Scrooge promoted economic growth more when he was a miser and saved most of his income than when he reformed and began spending freely. Suppose, though, that after he reformed he spent most of his income buying food for the Cratchits and other poor
The federal government in the United States has been running large budget deficits. Suppose that Congress and the president take actions that turn the budget deficits into budget surpluses.a. Use a market for loan able funds graph to illustrate the effect of the federal budget surpluses. What
Savers are taxed on the nominal interest payments they receive rather than the real interest payments. Suppose the federal government shifts from taxing nominal interest payments to taxing only real interest payments. (That is, savers will be allowed to subtract the inflation rate from the nominal
How does the financial system-both financial markets and financial intermediaries-provide risk sharing, liquidity, and information to savers and borrowers?
Briefly explain why the total value of saving in the economy must equal the total value of investment.
What are loan able funds? Why do businesses demand loan able funds? Why do households supply loan able funds?
Suppose you can receive an interest rate of 3 percent on a certificate of deposit at a bank that is charging borrowers 7 percent on new car loans. Why might you be unwilling to loan money directly to someone who wants to borrow from you to buy a new car, even if that person offers to pay you an
An International Monetary Fund Factsheet makes the following observation regarding sound financial systems: "A country's financial system ... provides a framework ...for supporting economic growth." Do you agree with this observation? Briefly explain.
Consider the following data for a closed economy: Y = $11 trillion C = $8 trillion I = $2 trillion TR = $1 trillion T = $3 trillion Use these data to calculate the following: a. Private saving b. Public saving c. Government purchases d. The government budget deficit or budget surplus
Consider the following data for a closed economy: Y = $12 trillion C = $8 trillion G = $2 trillion SPublic = $-0.5 trillion T = $2 trillion Use these data to calculate the following: a. Private saving b. Investment spending c. Transfer payments d. The government budget deficit or budget surplus
In problem 2.8, suppose that government purchases increase from $2 trillion to $2.5 trillion. If the values for Y and C are unchanged, what must happen to the values of S and I? Briefly explain. In problem 2.8 Y = $12 trillion C = $8 trillion G = $2 trillion SPublic = $-0.5 trillion T = $2 trillion
Robert Samuelson, a columnist for the Washington Post, argues that the Great Moderation actually caused the Great Recession. During the Great Moderation, "consumers could assume more debt-and lenders could lend more freely." Why might consumers have been willing to assume more debt and banks and
Briefly describe the effect of the business cycle on the inflation rate and the unemployment rate. Why might the unemployment rate continue to rise during the early stages of an expansion?
Why does a country's economic growth rate matter?
Explain the difference between the total percentage increase in real GDP between 2005 and 2015 and the average annual growth rate in real GDP between the same years.
Economists Carol Shiue and Wolfgang Keller of the University of Colorado published a study of "market efficiency" in the eighteenth century in England, other European countries, and China. If the markets in a country are efficient, a product should have the same price wherever in the country it is
Use the data on real GDP in the following table to answer the following questions. The values are measured in each country's domestic currency. The base year for Brazil is 1995; the base year for Mexico is 2008; and the base year for Thailand is 1988.a. Which country experienced the highest rate of
Andover Bank and Lowell Bank each sell one-year certificates of deposit (CDs). The interest rates on these CDs are given in the following table for a three-year period.Suppose you deposit $1,000 in a CD in each bank at the beginning of 2016. At the end of 2016, you take your $1,000 and any interest
Use the data for the United States in this table to answer the following questions.Year _____________Real GDP per Capita (2009 prices)2010 .................................. $47,7192011 ..................................48,1162012 ..................................48,8222013
In his book The White Man's Burden, William Easterly reports: A vaccination campaign in southern Africa virtually eliminated measles as a killer of children. Routine childhood immunization combined with measles vaccination in seven southern African nations starting in 1996 virtually eliminated
Economist Charles Kenny of the Center for Global Development has argued: The process technologies-institutions like laws and inventory management systems-that appear central to raising incomes per capita flow less like water and more like bricks. But ideas and inventions-the importance of
Using the per-worker production function graph from Figures 22.3 and 22.4 on pages 738 and 740, show the effect on real GDP per hour worked of an increase in capital per hour worked, holding technology constant. Now, again using the per-worker production function graph, show the effect on real GDP
Shortly before the fall of the Soviet Union, the economist Gur Ofer of Hebrew University of Jerusalem wrote, "The most outstanding characteristic of Soviet growth strategy is its consistent policy of very high rates of investment, leading to a rapid growth rate of [the] capital stock." Explain why
People who live in rural areas often have less access to capital and, as a result, their productivity is lower on average than the productivity of people who live in cities. An article in the New York Times quotes a financial analyst as arguing that "the core driver" of economic growth in China "is
Why is the role of entrepreneurs much more important in the new growth theory than in the traditional economic growth model?
What are the consequences for growth of diminishing returns to capital? How are some economies able to maintain high growth rates despite diminishing returns to capital?
What is the new growth theory? How does the new growth theory differ from the growth theory developed by Robert Solow?
Why are firms likely to under invest in research and development? Briefly discuss three ways in which government policy can increase the accumulation of knowledge capital.
Why does knowledge capital experience increasing returns at the economy level while physical capital experiences decreasing returns?
Which of the following will result in a movement along China's per-worker production function, and which will result in a shift of China's per-worker production function? Briefly explain. a. Capital per hour worked increases from 200 Yuan per hour worked to 250 Yuan per hour worked. b. The Chinese
The Making the Connection emphasizes that a key difference between market economies and centrally planned economies, like that of the former Soviet Union, is as follows: In market economies, entrepreneurs and managers who have their own money on the line make decisions about which investments to
Use the following graph to answer the questions. In each case, briefly explain your answer.a. True or false: The movement from point A to point B shows the effects of technological change. b. True or false: The economy can move from point B to point C only if there are no diminishing returns to
If the per-worker production function were shaped as shown in the following graph, what would be the implications for economic growth of a country that was accumulating increasing quantities of capital per hour worked? Briefly explain.
Describe the record of productivity growth in the United States from 1800 to the present.
Briefly describe the debate among economists over how high U.S. productivity growth rates are likely to be in the future.
Figure 22.5 on page 744 shows growth rates in real GDP per hour worked in the United States for various periods from 1800 onward. How might the growth rates in the figure be different if they were calculated for real GDP per capita instead of per hour worked?
A column in the Wall Street Journal considers two observations about the U.S. economy: "We live in an era of accelerating technological progress. ..." and "In the years since the recession ... the economy has been growing very slowly." The writer concludes that "Both statements can't be completely
Economist Robert Gordon of Northwestern University has argued: My interpretation of the [information] revolution is that it is increasingly burdened by diminishing returns. The push to ever smaller devices runs up against the fixed size of the human finger that must enter information on the device.
Some economists argue that the apparent slowdown in productivity growth in the United States in recent years is a measurement problem resulting from the failure of GDP to capture the effects of many recent innovations, such as cloud computing. James Manyika, head of technology at McKinsey &
Why does the economic growth model predict that poor countries should catch up to rich countries in real GDP per capita? Have poor countries been catching up to rich countries?
In 2015, President Barack Obama was quoted in an article in the Wall Street Journal as warning against "rising anti-globalization sentiment," which the president called "a big mistake." a. What did President Obama mean by "anti-globalization sentiment"? b. Why might he have considered such
A columnist in the New York Times observes that "many analysts agree that economic reform, of which integration into the global economy was a key element, has lifted millions of people out of poverty in India." What does "integration into the global economy" mean? How might integration into the
The Roman Empire lasted from 27 b.c. to a.d. 476. The empire was wealthy enough to build such monuments as the Roman Coliseum. Roman engineering skill was at a level high enough that aqueducts built during the empire to carry water long distances remained in use for hundreds of years. Yet, although
What are the main reasons many poor countries have experienced slow growth?
What does globalization mean? How have developing countries benefited from globalization?
Briefly explain whether the statistics in the following table are consistent with the economic growth model's predictions of catch-up.
In the following graph, each dot represents a particular country's initial level of real GDP per capita and its growth rate of real GDP per capita.a. For the range of initial GDP per capita from 0 to Real GDP per capita2, does the figure support the economic growth model's prediction of catch-up?
Refer to Figures 22.7-22.9 on pages 749 and 751. The lines in the following three graphs show the average relationship between the initial level of real GDP per capita and the growth rate of real GDP per capita for three groups of countries over a given time period. Match each group of countries
An article in the New York Times notes that since 2001 Italy has had the lowest rate of growth in labor productivity among European countries that use the euro common currency. The article quoted Italy's economy minister as saying, "The real tragedy for Italy is falling productivity." At the time
A study by the McKinsey Global Institute reported that labor productivity increased at an average annual rate of 5.8 percent between 1999 and 2013 in Mexico's large companies, but it fell at an average annual rate of 6.5 percent over the same period for its smaller firms, such as family-owned
In 2014, real GDP per capita in Mexico increased by 0.9 percent. A Mexican economist was quoted in an article in the Wall Street Journal as saying, "It's clearly insufficient if we want to significantly reduce poverty and move Mexico toward a middle-class country." a. Given that growth rate, how
Briefly describe three government policies that can increase economic growth.
Can economic analysis arrive at the conclusion that economic growth will always improve economic well-being? Briefly explain.
An article on the Mexican economy in the Economist notes, "A huge, unproductive informal sector and general lawlessness also drag the economy down." If these factors were the main barriers to more rapid economic growth in Mexico, would that be good news or bad news for the Mexican government's
In China, why may a lower birth rate lead to slower growth in real GDP per capita? Why might high levels of spending on investment in China lead to high rates of growth in the short run but not in the long run?
Pranab Bardhan, an economist at the University of California, Berkeley, argues: "China may be close to exhausting the possibilities of technological catch-up with the West, particularly in manufacturing." a. What does Bardhan mean by "technological catch-up"? b. If Bardhan is correct, what problems
Briefly explain which of the following policies are likely to increase the rate of economic growth in the United States. a. Congress passes an investment tax credit, which reduces a firm's taxes if it installs new machinery and equipment. b. Congress passes a law that allows taxpayers to reduce
In an interview on PBS about economic development in Africa, economist George Ayettey stated that of the 54 African countries, only 8 had a free press. For Africa's economic development, Ayittey argued strongly for the establishment of a free press. Why would a free press be vital for the
More people in high-income countries than in low-income countries tend to believe that rapid rates of economic growth are not desirable. Recall the concept of a "normal good". Does this concept provide insight into why some people in high-income countries might be more concerned with certain
Using data from the St. Louis Federal Reserve (FRED) (research.stlouisfed.org/ fred2/), analyze the relationship between labor productivity in the manufacturing sector and in the non-farm business sector as a whole. a. Download data since 1987 on output per hour of all persons in the manufacturing
Using data from the St. Louis Federal Reserve (FRED) (research.stlouisfed.org/fred2/), analyze differences in labor productivity among China, India, and the United States. a. From 1952 to the present, chart the following series on the same graph: real GDP per worker for China (RGDPL2CNA627NUPN),
The U.S. Central Intelligence Agency's World Face book (https://www.cia.gov/library/publications/the-world-factbook/) offers many comparative tables of world data. Go to this site and find the following: a. The countries with the highest and lowest real GDPs b. The countries with the highest and
What is the key idea in the aggregate expenditure macroeconomic model?
What are inventories? What usually happens to inventories at the beginning of a recession? At the beginning of an expansion?
Which of the following does the aggregate expenditure model seek to explain: long-run economic growth, the business cycle, inflation, or cyclical unemployment?
Into which category of aggregate expenditure would each of the following transactions fall? a. The Jones family buys a new car. b. The San Diego Unified School District buys 12 new school buses. c. The Jones family buys a newly constructed house from the Garcia Construction Co. d. Joe Jones orders
Assume that Intel sells $1 billion of computer chips to Dell, Inc., for use in Dell's personal computers. How does this transaction affect aggregate expenditure?
In reporting on real GDP growth in the second quarter of 2015, an article in the Wall Street Journal noted that the 2.3 percent annual growth rate "would have been stronger if it hadn't been for companies drawing down inventories." a. If companies are "drawing down inventories," is aggregate
An article in the Wall Street Journal stated that in China, "carmakers continue to grapple with ... rising inventories." Why might carmakers in China find that their inventories are unexpectedly rising? How are these carmakers likely to react to the increase in inventories?
According to an article in the Wall Street Journal, in late 2014, the Japanese economy experienced a large increase in business inventories. The article noted, "The large buildup of inventories is a reflection that the ... drop in demand was bigger than expected." Does it matter that Japanese firms
In the aggregate expenditure model, why is it important to know the factors that determine consumption spending, investment spending, government purchases, and net exports?
Fill in the blank cells in the following table. Assume for simplicity that taxes are zero. Also assume that the values represent billions of 2009 dollars.
In an opinion column in the Wall Street Journal, Purdue University President Mitchell Daniels wrote that "today's 20- and 30-year-olds are delaying marriage and delaying childbearing, both unhelpful trends from an economic and social standpoint." Why might young people be delaying marriage and
An article in the Wall Street Journal on changes in Intel's sales noted, "Intel sells its chips to customers in U.S. dollars, but many PC makers that buy those chips sell their products in local currencies." In these circumstances, would an increase in the value of the dollar relative to foreign
Briefly explain which of the following statement is correct. a. The iPhone is made in China, using Chinese-made parts. b. The iPhone is made in the United States, using U.S. made parts. c. The iPhone is made in the United States, using Chinese made parts. d. The iPhone is made China, using parts
In a speech to a conference of government trade officials, Angel Gurría, secretary general of the Organization for Economic Co-operation and Development, made the following observation: "As goods and services cross borders several times at different stages of processing, conventional trade
What are the five main determinants of consumption spending? Which of these is the most important? How would a rise in stock prices or housing prices affect consumption spending?
Compare what happened to real investment between 1979 and the second quarter of 2015 with what happened to real consumption during that period.
What are the four main determinants of investment? How would a change in interest rates affect investment?
What are the three main determinants of net exports? How would an increase in the growth rate of GDP in the BRIC nations (Brazil, Russia, India, and China) affect U.S. net exports?
Suppose a major U.S. appliance manufacturer is forecasting demand for its products during the next year. How will the forecast be affected by each of the following? a. A survey shows a sharp rise in consumer confidence that income growth will be increasing. b. Real interest rates are expected to
Draw the consumption function and label each axis. Show the effect of an increase in income on consumption spending. Does the change in income cause a movement along the consumption function or a shift of the consumption function? How would an increase in expected future income or an increase in
An economics student raises the following objection: "The textbook said that a higher interest rate lowers investment, but this doesn't make sense. I know that if I can get a higher interest rate, I am certainly going to invest more in my savings account." Briefly explain whether you agree with
Unemployed workers receive unemployment insurance payments from the government. Does the existence of unemployment insurance make it likely that consumption will fluctuate more or less over the business cycle than it would in the absence of unemployment insurance? Briefly explain.
What is the meaning of the 45° line in the 45° -line diagram?
Consider the table in the next column, which shows the change in inventories for each quarter from the first quarter of 2007 (2007:I) through the fourth quarter of 2010 (2010:IV) measured in billions of 2009 dollars. Provide a macroeconomic explanation for this pattern
Briefly explain whether you agree with the following argument: "The equilibrium level of GDP is determined by the level of aggregate expenditure. Therefore, GDP will decline only if households decide to spend less on goods and services."
Fill in the blank cells in the table below. Assume that the value of the MPC does not change as real GDP changes. Also assume that the values represent billions of 2009 dollars.a. What is the value of the MPC?b. What is the value of equilibrium real GDP?
What does the slope of the aggregate expenditure line equal? How is the slope of the aggregate expenditure line related to the slope of the consumption function?
What is the difference between aggregate expenditure and consumption spending?
At point A in the following graph, is planned aggregate expenditure greater than, equal to, or less than GDP? What about at point B? At point C? For points A and C, indicate the vertical distance that measures the unintended change in inventories.
Suppose we drop the assumption that net exports do not depend on real GDP. Draw a graph with the value of net exports on the vertical axis and the value of real GDP on the horizontal axis. Now, add a line representing the relationship between net exports and real GDP. Does your net exports line
A Federal Reserve publication notes that "the shedding of unwanted inventories often accounts for a large portion of the decline in gross domestic product (GDP) during economic recessions." What does the author mean be "shedding of unwanted inventories"? What makes the inventories unwanted? Why
An article on bloomberg.com about the Japanese economy noted, "Whether the 2.4 percent annualized gain in gross domestic product reported Wednesday can be maintained depends on consumers stepping in to buy the products that companies are piling up in warehouses."a. Did business inventories in Japan
The following graph contains two aggregate expenditure functions. Consider a movement from point A to point B and a movement from point B to point C. Which movement shows a change in autonomous expenditure? Which movement shows a change in induced expenditure? Briefly explain your answers.
Suppose the rate of growth of the economies in the BRIC nations (Brazil, Russia, India, and China) slows down, causing U.S. net exports to fall by $75 billion. If the MPC is 0.8, what will be the change in equilibrium U.S. GDP?
Would a larger multiplier lead to longer and more severe recessions or shorter and less severe recessions? Briefly explain.
A study by the management consulting company McKinsey & Company recommended that the U.S. increase spending on infrastructure, such as bridges and highways, by between $150 and $180 billion per year. The study estimated that the result would be an increase in GDP of between $270 billion and $320

Showing 1300 - 1400 of 2091

First
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21

Step by Step Answers

Services

Sitemap
Fun
Definitions
Become Tutor
Used Textbooks
Study Help Categories
Recent Questions
Expert Questions
Campus Wear
Sell Your Books

Company Info

Security
Copyrights
Privacy Policy
Terms & Conditions
SolutionInn Fee
Scholarship
Online Quiz
Give Feedback, Get Rewards

Get In Touch

About Us
Contact Us
Career
Jobs
FAQ
Student Discount
Campus Ambassador

Secure Payment

Download Our App

© 2026 SolutionInn. All Rights Reserved