Questions from Managerial Economics

Q: Suppose a country is rapidly making the transition from an agricultural-

Suppose a country is rapidly making the transition from an agricultural-based economy to an economy in which most of GDP comes from manufacturing. a) How do you think structural unemployment will be a...

Q: The following graph represents the labor market of a given country.

The following graph represents the labor market of a given country. Assuming the prevailing real wage is w1, a) measure unemployment using the graph. b) list three factors that might prevent this mark...

Q: Suppose that during the last ten years, Nicole tried to forecast

Suppose that during the last ten years, Nicole tried to forecast future inflation rates to negotiate her salary. Every year, she used all available information and even incorporated news about the con...

Q: Comment on the impact on the Fed’s credibility of the appointment of

Comment on the impact on the Fed’s credibility of the appointment of a majority of governors who are reluctant to increase interest rates to fight inflation for fears of causing too much unemployment...

Q: Consider two individuals forming expectations about mortgage rates. Mark forms adaptive

Consider two individuals forming expectations about mortgage rates. Mark forms adaptive expectations, and looks only at past mortgage rates to form expectations about future rates. Gloria forms ration...

Q: Suppose an econometric model based on past data predicts a small decrease

Suppose an econometric model based on past data predicts a small decrease in domestic investment when the Federal Reserve increases the federal funds rate. Assume that the Federal Reserve is consideri...

Q: Go to the St. Louis Federal Reserve FRED database, and

Go to the St. Louis Federal Reserve FRED database, and find data on Real Private Domestic Investment (GPDIC1); a measure of the real interest rate, the 10-year Treasury Inflation-Indexed Security, TII...

Q: What are the benefits and costs of sticking to a set of

What are the benefits and costs of sticking to a set of rules in each of the following cases? How do each of these situations relate to the conduct of economic policy? a) Going on a diet b) Raising ch...

Q: In some countries, the president chooses the head of the central

In some countries, the president chooses the head of the central bank. The same president can fire the head of the central bank and replace him or her with another director at any time. Explain the im...

Q: Central banks that engage in inflation targeting usually announce the inflation target

Central banks that engage in inflation targeting usually announce the inflation target and the time period for which that target will be relevant. In addition, central bank officials are held accounta...