Principles Of Macroeconomics 4th Edition Robert Frank, Ben Bernanke - Solutions

Unlock the full potential of your learning journey with our comprehensive answers key and solutions manual for "Principles of Macroeconomics, 4th Edition" by Robert Frank and Ben Bernanke. Our online resource offers a detailed solutions PDF, providing step-by-step answers to solved problems. Access the instructor manual and textbook solutions for an in-depth understanding of each chapter. Whether you're tackling test bank questions or seeking chapter solutions, our free download ensures you have the essential tools for success. Explore our questions and answers to enhance your macroeconomics knowledge, all conveniently available online.

The equilibrium price will rise, but equilibrium quantity may increase, decrease, or stay the same ifa. demand increases and supply decreases.b. demand increases and supply increases.c. demand decreases and supply increases.d. demand decreases and supply decreases.e. demand increases and supply
Which of the following will lead to an increase in the equilibrium price of product “X”? A(n)a. increase in consumer incomes if product “X” is an inferior goodb. increase in the price of machinery used to produce product “X”c. technological advance in the production of good “X”d.
Which of the following describes what will happen in the market for tomatoes if a salmonella outbreak is attributed to tainted tomatoes?a. Supply will decrease and price will increase.b. Supply will decrease and price will decrease.c. Demand will decrease and price will increase.d. Demand will
Periodically, a computer chip maker like Intel introduces a new chip that is faster than the previous one. In response, demand for computers using the earlier chip decreases as customers put off purchases in anticipation of machines containing the new chip. Simultaneously, computer makers increase
For each of the following examples, explain how the indicated change affects supply or demand for the good in question and how the shift you describe affects equilibrium price and quantity.a. As the price of gasoline fell in the United States during the 1990s, more people bought large cars.b. As
Draw a correctly labeled graph showing the market for oranges in equilibrium. Show on your graph how a hurricane that destroys large numbers of orange groves in Florida will affect supply and demand, if at all.
Draw a correctly labeled graph showing the market for tomatoes in equilibrium. Label the equilibrium price “PE” and the equilibrium quantity “QE.” On your graph, draw a horizontal line indicating a price, labeled “PC”, that would lead to a shortage of tomatoes. Label the size of the
The market price of a good will tend to rise ifa. demand decreases.b. supply increases.c. it is above the equilibrium price.d. it is below the equilibrium price.e. demand shifts to the left.
Which of the following is true at equilibrium?a. The supply schedule is identical to the demand schedule at every price.b. The quantity demanded is the same as the quantity supplied.c. The quantity is zero.d. Every consumer who enjoys the good can consume it.e. Producers could not make any more of
A technological advance in textbook production will lead to which of the following?a. a decrease in textbook supplyb. an increase in textbook demandc. an increase in textbook supplyd. a movement along the supply curve for textbookse. an increase in textbook prices
An increase in the demand for steak will lead to an increase in which of the following?a. the supply of steakb. the supply of hamburger (a substitute in production)c. the supply of chicken (a substitute in consumption)d. the supply of leather (a complement in production)e. the demand for leather
Which of the following will decrease the supply of good “X”?a. There is a technological advance that affects the production of all goods.b. The price of good “X” falls.c. The price of good “Y” (which consumers regard as a substitute for good “X”) decreases.d. The wages of workers
Why does the market price rise if it is below the equilibrium price?
Why does the market price fall if it is above the equilibrium price?
Why do all sales and purchases in a market take place at the same price?
Draw a correctly labeled graph showing the demand for apples.On your graph, illustrate what happens to the demand for apples if a new report from the Surgeon General finds that an apple a day really does keep the doctor away
Create a table with two hypothetical prices for a good and two corresponding quantities demanded. Choose the prices and quantities so that they illustrate the law of demand. Using your data, draw a correctly labeled graph showing the demand curve for the good. Using the same graph, illustrate an
Which of the following will increase the demand for disposable diapers?a. a new “baby boom”b. concern over the environmental effect of landfillsc. a decrease in the price of cloth diapersd. a move toward earlier potty training of childrene. a decrease in the price of disposable diapers
Which of the following will occur if consumers expect the price of a good to fall in the coming months?a. The quantity demanded will rise today.b. The quantity demanded will remain the same todayc. Demand will increase today.d. Demand will decrease today.e. No change will occur today.
If an increase in income leads to a decrease in demand, the good isa. a complement.b. a substitute.c. inferior.d. abnormal.e. normal.
A decrease in the price of butter would most likely decrease the demand fora. margarine.b. bagels.c. jelly.d. milk.e. syrup
Which of the following would increase demand for a normal good? A decrease ina. price.b. income.c. the price of a substitute.d. consumer taste for a good.e. the price of a complement.
Explain whether each of the following events represents (i) a change in demand (a shift of the demand curve) or (ii) a movement along the demand curve (a change in the quantity demanded).a. A store owner finds that customers are willing to pay more for umbrellas on rainy days.b. When XYZ Telecom, a
Explain whether each of the following events represents (i) a change in demand (a shift of the demand curve) or (ii) a movement along the demand curve (a change in the quantity demanded).a. A store owner finds that customers are willing to pay more for umbrellas on rainy days.b. When XYZ Telecom, a
Study the four accompanying diagrams. Consider the following statements and indicate which diagram matches each statement. For each statement, tell which variable would appear on the horizontal axis and which on the vertical. In each of these statements, is the slope positive, negative, zero, or
Peter Pundit, an economics reporter, states that the European Union (EU) is increasing its productivity very rapidly in all industries. He claims that this productivity advance is so rapid that output from the EU in these industries will soon exceed that of the United States and, as a result, the
According to the U.S. Census Bureau, in July 2006 the United States exported aircraft worth $1 billion to China and imported aircraft worth only $19,000 from China. During the same month, however, the United States imported $83 million worth of men’s trousers, slacks, and jeans from China but
The Hatfield family lives on the east side of the Hatatoochie River, and the McCoy family lives on the west side. Each family’s diet consists of fried chicken and corn-on-the-cob, and each is self-sufficient, raising their own chickens and growing their own corn. Explain the conditions under
According to data from the U.S. Department of Agriculture’s National Agricultural Statistics Service, 124 million acres of land in the United States were used for wheat or corn farming in 2004. Of those 124 million acres, farmers used 50 million acres to grow 2.158 billion bushels of wheat, and
In the ancient country of Roma, only two goods, spaghetti and meatballs, are produced. There are two tribes in Roma, the Tivoli and the Frivoli. By themselves, the Tivoli each month can produce either 30 pounds of spaghetti and no meatballs, or 50 pounds of meatballs and no spaghetti, or any
Two important industries on the island of Bermuda are fishing and tourism. According to data from the World Resources Institute and the Bermuda Department of Statistics, in the year 2000 the 307 registered fishermen in Bermuda caught 286 metric tons of marine fish. And the 3,409 people employed by
Suppose Atlantis is a small, isolated island in the South Atlantic. The inhabitants grow potatoes and catch fish. The accompanying table shows the maximum annual output combinations of potatoes and fish that can be produced. Obviously, given their limited resources and available technology, as they
Evaluate this statement: “It is easier to build an economic model that accurately reflects events that have already occurred than to build an economic model to forecast future events.” Do you think that this is true or not? Why? What does this imply about the difficulties of building good
Why do we consider a business-cycle expansion to be different from economic growth?
Are the following statements true or false? Explain your answers.a. “When people must pay higher taxes on their wage earnings, it reduces their incentive to work” is a positive statement.b. “We should lower taxes to encourage more work” is a positive statement.
A representative of the U.S. clothing industry recently made this statement: “Workers in Asia often work in sweatshop conditions earning only pennies an hour. American workers are more productive and, as a result, earn higher wages. In order to preserve the dignity of the American workplace, the
Use the concept of opportunity cost to explain the following situations.a. More people choose to get graduate degrees when the job market is poor.b.More people choose to do their own home repairs when the economy is slow and hourly wages are down.c. There are more parks in suburban areas than in
Describe some of the opportunity costs of the following choices.a. Attend college instead of taking a job.b.Watch a movie instead of studying for an exam.c. Ride the bus instead of driving your car.
Imagine a firm that manufactures textiles (pants and shirts).List the four categories of resources, and for each category, give an example of a specific resource that the firm might use to manufacture textiles.
Refer to the table below to answer the following questions.These two countries are producing textiles and wheat using equal amounts of resources.a. What is the opportunity cost of producing a bushel of wheat for each country?b. Which country has the absolute advantage in wheat production?c. Which
Refer to the graph below to answer the following questionsa. What is the opportunity cost of a bushel of corn in each country?b. Which country has an absolute advantage in computer production? Explain.c. Which country has a comparative advantage in corn production? Explain.d. If each country
What is the highest price Country B is willing to pay to buy wheat from Country A?a. 1⁄2 units of textilesb. 2⁄3 units of textilesc. 1 unit of textilesd. 11⁄2 units of textilese. 2 units of textiles
If the two countries specialize and trade, which of the choices below describes the countries’ imports?Import Wheat Import Textilesa. Country A Country Ab. Country A Country Bc. Country B Country Bd. Country B Country Ae. Neither Country Country B
Use the graph to determine which country has a comparative advantage in producing each good.Comparative advantage Comparative advantage in wheat production in textile productiona. Country A Country Bb. Country A Country Ac. Country B Country Ad. Country B Country Be. Country A Neither Country
For country A, the opportunity cost of a bushel of wheat isa. 1⁄2 units of textilesb. 2⁄3 units of textilesc. 11⁄3 units of textilesd. 11⁄2 units of textilese. 2 units of textiles
Use the graph to determine which country has an absolute advantage in producing each good.Absolute advantage Absolute advantage in wheat production in textile productiona. Country A Country Bb. Country A Country Ac. Country B Country Ad. Country B Country Be. Country A Neither Country
Refer to the story of Tom and Hank illustrated by Figure 4.1 in the text. Explain why Tom and Hank are willing to engage in a trade of 1 fish for 11⁄2 coconuts.
In Italy, an automobile can be produced by 8 workers in one day and a washing machine by 3 workers in one day. In the United States, an automobile can be produced by 6 workers in one day, and a washing machine by 2 workers in one day.a. Which country has an absolute advantage in the production of
How comparative advantage leads to gains from trade in the global marketplace?
The difference between absolute advantage and comparative advantage
How trade leads to gains for an individual or an economy
Assume that an economy can choose between producing food and producing shelter at a constant opportunity cost. Draw a correctly labeled production possibilities curve for the economy. On your graph:a. Use the letter E to label one of the points that is efficient in production.b. Use the letter U to
Refer to the graph below. Assume that the country is producing at point C.a. Does this country’s production possibilities curve exhibit increasing opportunity costs? Explain.b. If this country were to go to war, the most likely move would be from point C to which point? Explain.c. If the economy
This production possibilities curve shows the trade-off between consumer goods and capital goods. Since capital goods are a resource, an increase in the production of capital goods today will increase the economy’s production possibilities in the future. Therefore, all other things equal (ceteris
Which of the following might allow this economy to move from point B to point F?a. more workersb. discovery of new resourcesc. building new factoriesd. technological advancese. all of the above
An increase in unemployment could be represented by a movement from pointa. D to point C.b. B to point A.c. C to point F.d. B to point E.e. E to point B.
For this economy, an increase in the quantity of capital goods produced without a corresponding decrease in the quantity of consumer goods produceda. cannot happen because there is always an opportunity cost.b. is represented by a movement from point E to point A.c. is represented by a movement
Which point(s) on the graph represent efficiency in production?a. B and Cb. A and Dc. A, B, C, and Dd. A, B, C, D, and Ee. A, B, C, D, E, and F
True or false? Explain your answer.a. An increase in the amount of resources available to Tom for use in producing coconuts and fish does not change his production possibilities curve.b. A technological change that allows Tom to catch more fish relative to any amount of coconuts gathered results in
Define inflation, and explain why an increase in the price of donuts does not indicate that inflation has occurred.
Define an expansion and economic growth, and explain the difference between the two concepts.
The other things equal assumption allows economists toa. avoid making assumptions about reality.b. focus on the effects of only one change at a time.c. oversimplify.d. allow nothing to change in their model.e. reflect all aspects of the real world in their model.
Which of the following is the most likely result of inflation?a. falling employmentb. a dollar will buy more than it did beforec. people are discouraged from holding cashd. price stabilitye. low aggregate output per capita
A sustained increase in aggregate output over several decades representsa. an expansion.b. a recovery.c. a recession.d. a depression.e. economic growth.
The labor force is made up of everyone who isa. employed.b. old enough to work.c. actively seeking work.d. employed or unemployed.e. employed or capable of working.
During the recession phase of a business cycle, which of the following is likely to increase?a. the unemployment rateb. the price levelc. economic growth ratesd. the labor forcee. wages
Describe who gets hurt in a recession and how they are hurt.
Why do we talk about business cycles for the economy as a whole, rather than just talking about the ups and downs of particular industries?
In what type of economic analysis do questions have a “right”or “wrong” answer? In what type of economic analysis do questions not necessarily have a “right” answer? On what type of economic analysis do economists tend to disagree most frequently? Why might economists disagree? Explain.
Define resources, and list the four categories of resources. What characteristic of resources results in the need to make choices?
Which of the following questions is studied in microeconomics?a. Should I go to college or get a job after I graduate?b. What government policies should be adopted to promote employment in the economy?c. How many people are employed in the economy this year?d. Has the overall level of prices in the
Which of the following statements is/are normative?I. The price of gasoline is rising.II. The price of gasoline is too high.III.Gas prices are expected to fall in the near future.a. I onlyb. II onlyc. III onlyd. I and III onlye. I, II, and III
Suppose that you prefer reading a book you already own to watching TV and that you prefer watching TV to listening to music. If these are your only three choices, what is the opportunity cost of reading?a. watching TV and listening to musicb. watching TVc. listening to musicd. sleepinge. the price
Which of the following situations represent(s) resource scarcity?I. Rapidly growing economies experience increasing levels of water pollution.II. There is a finite amount of petroleum in the physical environment.III. Cassette tapes are no longer being produced.a. I onlyb. II onlyc. III onlyd. I and
Which of the following is an example of a resource?I. petroleum II. a factory III. a cheeseburger dinnera. I onlyb. II onlyc. III onlyd. I and II onlye. I, II, and III
Identify each of the following statements as positive or normative, and explain your answer.a. Society should take measures to prevent people from engaging in dangerous personal behavior.b. People who engage in dangerous personal behavior impose higher costs on society through higher medical costs.
You make $45,000 per year at your current job with Whiz Kids Consultants. You are considering a job offer from Brainiacs, Inc., which would pay you $50,000 per year. Which of the following are elements of the opportunity cost of accepting the new job at Brainiacs, Inc.? Answer yes or no, and
What type of resource is each of the following?a. time spent flipping hamburgers at a restaurantb. a bulldozerc. a river
What are the four categories of resources? Give an example of a resource from each category.
10. Use a diagram like Figure 16.9 to show the effects of each of the following on the real interest rate and capital investment of a country that is a net borrower from abroad.a. Investment opportunities in the country improve owing to new technologies.b. The government budget deficit rises.c.
9. How do each of the following transactions affect (1) the trade surplus or deficit and (2) capital inflows or outflows for the United States? Show that in each case the identity that the trade balance plus net capital inflows equals zero applies. LO1a. A U.S. exporter sells software to Israel.
8. Suppose that a U.S. worker can produce 1,000 pairs of shoes or 10 industrial robots per year. For simplicity, assume there are no costs other than labor costs and firms earn zero profits. Initially, the U.S. economy is closed. The domestic price of shoes is $30 per pair, so a U.S. worker can
7. A developing economy requires 1,000 hours of work to produce a television set and 10 hours of work to produce a bushel of corn. This economy has available a total of 1,000,000 hours of work per day. LO2, LO3a. Draw the PPC for daily output of the developing economy. Give numerical values for the
6. A small open economy is equally productive in producing coffee and tea—that is, for each additional pound of coffee it produces, it must sacrifice the production of exactly one pound of tea. What will this economy produce if the world price of coffee is 20 percent higher than that of tea?.
5. If the world price of refrigerators rose to $1,200 and the price of television sets remained $1,000, how will this country alter the mix of the two goods it produces?How will it alter the mix of the two goods it consumes? LO2
4. If refrigerators and television sets both sell for $1,000 in the world market, how many units of each good should this country produce? LO2
3. If refrigerators and television sets both sell for $1,000 in the world market, is it possible for this country to consume 1,000 television sets per year and 2,200 refrigerators? Could the country consume 1,000 refrigerators each year and 2,500 television sets? LO2
2. If refrigerators and television sets can each be bought or sold for $500 in the world market, what is the maximum number of refrigerators this country can consume each year? The maximum number of television sets? How would your answers change if refrigerators and television sets both sold for
1. What is the maximum number of television sets this country can produce each year? What is the maximum number of refrigerators? LO2
5. How are capital inflows or outflows related to domestic investment in new capital goods?
4. How would increased political instability in a country likely affect capital inflows, the domestic real interest rate, and investment in new capital goods?Show graphically. LO5
3. True or false and explain: Trade makes domestic producers of an imported good better off and domestic consumers of an imported good worse off. LO3
2. What is meant by the consumption possibilities of a country? How are consumption possibilities related to production possibilities in a closed economy? In an open economy? LO2
1. Explain with examples why, in any period, a country’s net capital inflows equal its trade deficit LO1
10. Answer each of the following questions. LO5a. Gold is $350 per ounce in the United States and 2,800 pesos per ounce in Mexico. What nominal exchange rate between U.S. dollars and Mexican pesos is implied by the PPP theory?b. Mexico experiences inflation so that the price of gold rises to 4,200
9. Between last year and this year, the CPI in Blueland rose from 100 to 110 and the CPI in Redland rose from 100 to 105. Blueland’s currency unit, the blue, was worth $1 (U.S.) last year and is worth 90 cents (U.S.) this year. Redland’s currency unit, the red, was worth 50 cents (U.S.) last
8. A British-made automobile is priced at £20,000 (20,000 British pounds). A comparable U.S.-made car costs $26,000. One pound trades for $1.50 in the foreign exchange market. Find the real exchange rate from the perspective of the United States and from the perspective of Great Britain. Which
7. Eastland’s currency is called the eastmark and Westland’s currency is called the westmark. In the market in which eastmarks and westmarks are traded for each other, the supply of and demand for eastmarks are given by Demand 25,000 5,000e 50,000(rE rW), Supply 18,500 8,000e 50,000(rE rW).The
6. The annual demand for and supply of shekels in the foreign exchange market is as given in problem 5. The shekel is fixed at 0.30 dollar per shekel. The country’s international reserves are $600. Foreign financial investors hold checking accounts in the country in the amount of 5,000 shekels.
5. The demand for and supply of shekels in the foreign exchange market are Demand 30,000 8,000e, Supply 25,000 12,000e, where the nominal exchange rate is expressed as U.S. dollars per shekel. LO2, LO3a. What is the market equilibrium value of the shekel?b. The shekel is fixed at 0.30 U.S. dollar.

Showing 1300 - 1400 of 4718

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

Principles Of Macroeconomics 4th Edition Robert Frank, Ben Bernanke - Solutions

Step by Step Answers