Econ Homework HELP!

2-22-2016

Dear class:

Week after next (March 7th – March 13th) will be devoted entirely to the Mid-Term Exam.

Please be advised of the following:

1. The exam will be taken electronically on D2L. (See D2L technical note below)

2. The exam will be available on the Content page between the hours of 12:01 AM on March 7th until 11:59 PM on March 13th. You may take the exam at any time during this period, although I urge you in the strongest possible terms NOT to delay taking the exam until Sunday evening (March 13th). Sunday evening tends to be the busiest time of the week on D2L and to delay taking your exam until that time is to invite trouble in accessing the system, saving your answers, and submitting your completed exam.

3. You will be allowed a maximum of 120 minutes to complete the exam. The exam includes 17 regular questions (101 points total). Thus you will want to ration your time across all questions. [For purposes of calculating your final course grade, your score on the Mid-Term will be entered in the course D2L Grade Book on a 200 point basis.]

4. Once you open the exam, you must finish it within the next 120 minutes. You will NOT be able to start the exam, close it, and then reopen to finish the exam later.

5. The exam questions are short-answer essay or calculations. There are no multiple-choice or true-false questions. You may use a calculator during the exam, but you are not permitted to consult your textbook or your notes.

6. You will be required to sign an honor pledge at the end of the exam. The statement certifies that the completed exam is your own work, that you have not consulted your text or your notes, and that you have neither assisted any other member of the class nor have you been assisted by any other person.

Online quiz technical guidelines for students

Instructors are urged to give students these guidelines to avoid technical problems during online quizzes:

· Use the most reliable internet connection available: Come to a campus lab, if possible. Next in reliability are cable modem and DSL. Dial-up is not recommended.

· Use a "hard-wired" internet connection, NOT WIRELESS.

· SAVE each answer as they move through the quiz.

· WAIT a minute after hitting Submit Quiz, before shutting down the browser or logging out of D2L -- this allows the system to properly save their responses and do the auto-grading, if that option is enabled.

· If the student has browser issues (e.g., the browser "freezes") or loses internet connectivity during the quiz, they should

· shut down the browser (do not submit the quiz, do not log out)

· open a new browser window

· log back into D2L

· navigate to the course and enter the quiz again

· continue taking the quiz.

· NOTE: In a timed quiz, the clock keeps ticking.

G. Richard Meadows

Professor Emeritus (Economics) and Dean Emeritus College of Letters and Science UW-Milwaukee

Continue to the Study Guide on the Next Three Pages.

Study Guide for the Mid-Term Exam (Econ. 104, Section 206) 2-22-16

You should understand and be able to define the following terms (all are defined in the Glossary in your text pp. 433-436):

Macroeconomics

Opportunity costs

Market failure

Externality

Market power

Inflation

Phillips Curve

Business cycle

Imports

Absolute advantage

Comparative advantage

Exports

Imports

Gross Domestic Product

Consumption

Gross Private Domestic Investment

Net Exports

Government purchases

Nominal GDP

Real GDP

GDP deflator

Nominal Interest Rate

Real Interest Rate

Consumer Price Index (CPI)

Inflation Rate

Productivity (Labor Force Productivity)

Human Capital

You should be able to explain and apply the following concepts:

1. What role is played by the concept of scarcity in the study of economics?

2. How does society face a “trade off” between equity and efficiency? How might government programs designed to address one problem exacerbate others?

3. What is the role of absolute and comparative advantage in understanding trade patterns between nations?

4. How does one use year-to-year changes in the Consumer Price Index to measure changes in real earnings? [Example: if your salary rose 3% this year (as compared to last), but prices rose by 5%, are you better off?]

5. You should be able to explain the various components of GDP and calculate the numerical value of GDP from data provided.

6. You should be able to explain the limitations of the use of the Consumer Price Index as a measure of changes in the true cost-of-living. Mankiw mentions three problems associated with the CPI: substitution bias, the introduction of new goods, and unmeasured quality changes. You should be able to name and explain these problems.

7. You should be able to explain the difference between the major price indexes discussed in the text (Consumer Price Index, Producer Price Index, GDP Deflator).

8. You should be able to explain the role played by productivity gains in increases in a nation’s economic welfare over time.

9. You should be able to explain the difference between positive and normative statements regarding the economy, and you should be able to identify statements regarding the economy as being positive or normative.

10. You should understand and be able to explain different federal government budget outcomes – deficit, balance, surplus – and the relationship between the federal budget outcome and the resultant level of aggregate Investment spending (at full employment).

11. You should be able to explain why (in the simple macro model of Chapter 8 - without foreign trade) Investment spending equals Savings.

12. You should be able to explain the loanable funds approach to the determination of interest rates and the level of Investment spending.

13. You should be able to explain the “crowding out” theory of how government deficits are said to reduce private investment spending (at full employment). Could one argue, for example, that the current fiscal deficit at the federal level have/had “crowding out” consequences for the economy as a whole? What role does the proximity of the economy to full employment (or full capacity) play in the crowding out debate?

14. You should be able to explain the relationship between formal education achieved and average earnings levels. How does the relationship between education and earnings vary by gender (if at all)? Does the gender/earnings relationship change when we compare only full-time, year round workers, and if so, why?

15. You should be able to describe (in general terms) the current state of the U.S. economy. What stage of the business cycle (expansion or contraction) are we in now? What are the central economic problems facing the American economy at present, and what actions (if any) have been taken (within the last five years) by the Congress, the Federal Reserve, the U.S. Treasury, and Central Banks around the world to deal with the economic challenges of the last five years?

16. You should be able to describe the general employment/unemployment situation in the American economy at present. What has happened to the total number of jobs and the national unemployment rate in the last 12 months? Have changes in the “labor-force participation rate” (over the last few years) had an impact on our national unemployment rate? Does the unemployment rate vary by gender, age, and occupation? Explain (in general terms) what these differences are.

17. You should be able to explain the current overall budget outcome for the federal government (deficit, surplus, or balance) in the United States. Explain how the events since January 2008 have pushed the budget outcome in one direction or another?