Questions from Macroeconomics

Q: On the accompanying graph, illustrate for each year (A

On the accompanying graph, illustrate for each year (A) the nominal interest rate (use the prime rate of interest), (B) the CPI inflation rate, and (C) the real interest rate (adjusted for same-yea...

Q: Where and when will those Las Vegas carpenters (see News,

Where and when will those Las Vegas carpenters (see News, p. 122) find jobs?

Q: Assume the banking system contains the following amounts: Total reserves

Assume the banking system contains the following amounts: Total reserves $80 billion Transactions deposits $800 billion Cash held by public $100 billion Reserve requirement...

Q: Assume that a $1,000 bond issued in 2012 pays

Assume that a $1,000 bond issued in 2012 pays $100 in interest each year. What is the current yield on the bond if it can be purchased for (a) $1,200? (b) $1,000? (c) $800?

Q: Suppose a $1,000 bond pays $50 per year

Suppose a $1,000 bond pays $50 per year in interest. (a) What is the contractual interest rate (“coupon rate”) on the bond? (b) If market interest rates rise to 8 percent, what price will t...

Q: The following data describe market conditions. /

The following data describe market conditions. (a) At what rate of interest does the liquidity trap emerge? (b) At what rate of interest does investment demand become totally inelastic?

Q: Use the accompanying graphs to show what happens in the economy when

Use the accompanying graphs to show what happens in the economy when M increases from $300 billion to $400 billion. (a) By how much does PQ change if V is constant? (b) If aggregate supply w...

Q: Use the data on the end covers of this text to determine

Use the data on the end covers of this text to determine for 2007 and 2010 (a) The interest rate on 10-year Treasury bonds. (b) The U.S. inflation rate. (c) The real rate of interest....

Q: Suppose home owners owe $5 trillion in mortgage loans.

Suppose home owners owe $5 trillion in mortgage loans. (a) If the mortgage interest rate is 7 percent, approximately how much are home owners paying in annual mortgage interest? (b) If the i...

Q: According to Bernanke’s policy guide (p. 320), what was

According to Bernanke’s policy guide (p. 320), what was the fiscal policy equivalent of China’s 2010 interest rate hike? (See World View, p. 321) (a) Initially? (b) Cumulatively?