Question 10 (5 points)Q10. In the wake of the Covid-19 pandemic, many economists argued that inflation wasbeing driven by disruptions to complex and geographically dispersed (global) supplychains. Assuming that is true, or partly true, which of the following would be the best way toalter the Philipps' Curve equation above [n = - a (Uª – U*)] to reflect the impact of supplychains. Which makes the most sense, where is the rate of inflation, Ua is the actual回unemployment rate, U* is the full employment rate of unemployment (or the maximumunemployment rate before the economy experiences accelerating inflation), and is avariable measuring the efficiency gained from well-functioning supply chains.=-a (Ua - U •)- €,=-a (Ua-U)+EM-a (Ua - UXET=-E/-a (Ua-U)]Inflation is caused by excessive cannabis consumption, which is giving manypeople in our society the delusion of feeling good while eroding the productivity(don't choose this one).

The objective of the question is to understand how to modify the Phillips Curve equation to account…

Answered: Question 10 (5 points) Q10. In the wake…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Consumer spending fell significantly at the start of the pandemic by 13.6%, but increased by 5.6% in June. Economists are predicting that in the next few months consumer spending may be positive but at a much lower rate than 5.6% as additional money for unemployment is no longer available, unemployment remains high, and uncertainty of the future. Consumer spending is closely watched since it is a primary predictor of how quickly the economy will recover from the current recession. How do you expect consumer spending might change over the next few months? Why? How has your spending been changing? Are you expecting to make any big purchases in the near future?
Respond to the question with a concise and accurate answer, along with a clear explanation and step-by-step solution, or risk receiving a downvote.
Variables typically included in a multivariate supply function (other than the price and quantity of the item the supply function represents) are prices of other goods that use similar input resources for production, the number of suppliers, techniques of production, taxes and subsidies, prices of input resources, weather, and expectations. Please answer the following questions about the affect changes in other variables might have on the supply of the item. These changes will either cause supply to increase (shift right) or decrease (shift left). Use either word as applicable, for the short answer. 1. If the market price of gasoline returns to the near $4.00 per gallon level then demand for gas-gulping large autos is likely to decrease and manufacturers of these autos are likely to _____________ their supply: 2. A relative increase in the productivity of the technology used to produce the item being considered is likely to _____________________ its supply. 3. Hailstorms have pelted…
The outbreak of COVID-19 adversely attacks most economies. Some economists e/2 argue that the impacts on the macroeconomy mainly come from (i) the reduction in consumption and investment appetite, while others believe that the impacts mainly come from (ii) the immediate destruction of the supply-chain and production. Suppose two quarters since the outbreak of the COVID-19, changes in selected macroeconomic data of Country X can be summarized as below: Last year This year Annualized economic growth rate 4% -6% Unemployment rate 5% 8% Inflation rate 2% 5% Using an AD-AS model, explain whether argument (i) or (ii) above fits better to а. the case of Country X. b. Given your answer in (a), briefly discuss one plausible short-run dilemma facing the central bank of Country X.
Suppose the cotton (a storable commodity) futures prices are currently Expiry Month Price c/lb December 2021 83 December 2022 96 (a) Suppose an unexpected typhoon destroys cotton crops in India. This causes a downward revision in the expected global cotton production in 2022. Assuming all else equal, will demand for storage of cotton in 2021 (St) increase, decrease or stay the same? Draw a graph of the demand for storage to support your answer. (b) Using the same scenario from (a), do you expect the cotton market to still in contango, inverted, or could it be either contango or inverted? Draw a graph of supply and demand for storage to support your answer.
Draw and properly label an AD-AS model to show Keynesian, intermediate, andneoclassical zones (6%). Then, briefly explain the levels of unemployment, inflationand real GDP in each zone, and also confirm whether all three goals of a macroeconomy are being achieved in each zone. (14%)
Suppose there are claims that a new war in the Persian Gulf could shift the world supply curve to the left, causing the world price of oil to soar regardless of whether we drill in ANWR. How accurate is this claim? Use the same type of analysis as in the text solved problem to calculate how much a shock would cause the price to rise without and with the ANWR production. According to the solved problem, demand is initially: and supply is initially Q=117.50-0.47p Q = 70.50 +0.47p (without negative oil shocks and ANWR oil production). Now incorporate a negative oil shock of 4 million barrels a day (shifting the supply curve for oil to the left by that amount). Without the ANWR production, price rises by $4.3 per barrel. (Enter a numeric response using a rea number rounded to two decimal places.) With ANWR production of 0.8 million barrels of oil per day (and the negative oil shock), price rises by $ (Enter a numeric response using a real number rounded to two decimal places.) per barrel.
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Let’s see just how much high expected inflation can hurt incentives to save for the long run. Let’s assume the government takes about one‑third of every extra dollar of nominal interest you earn. You must pay taxes on nominal interest. However, if you are rational, you will care mostly about your real, after‑tax interest rate when deciding how much to save. ?i ??=?Eπ=π 23×?23×i (23×?)−?(23×i)−π Nominal interest rate Inflation (no surprises) Nominal after‑tax return Real after‑tax return 15% 12% 10% -2% 6% 3% 12% 9% 90% 87% 900% 897% Calculate the nominal and real after‑tax return for each case.Nominal interest rate = 6%, inflation = 3% Nominal after‑tax return: % Real after‑tax return: % Nominal interest rate = 12%, inflation = 9% Nominal after‑tax return: % Real after‑tax return: % Nominal interest rate = 90%, inflation = 87% Nominal after‑tax return: %…
Between 2007 and 2009, the United States experienced a severe financial crisis and economic downturn commonly known as the Great Recession. Starting in 2006, housing values fell 30%, causing losses in mortgage-backed securities for families and financial institutions. The recession was marked by a drop in aggregate demand that caused a decline in GDP and an increase in unemployment. Attached is an example of an aggregate demand and aggregate supply (AD/AS) model that illustrates the general trends of the U.S. economy during the Great Recession. How did the AD/AS equilibrium change over time? Support your claims by referring to your AD/AS model. Select an economic factor (GDP, unemployment, price level) and explain what impact any shifts in AD or AS (or both) had on your chosen factor. Please tailor the answer according the AD/AS model in layman's terms
8, Q2) Hey, need help with the following multi-part macroeconomics problem. Thank you in Advance! Many kinds of loans, like student loans and mortgages, can be taken out at either a fixed or variable rate. A fixed rate loan allows the borrower to pay the same nominal interest rate for the entire lifetime of the loan, while a variable rate loan may experience changes in in the nominal interest rate as the rate that banks charge each other for overnight loans changes. For this problem, assume that this variable nominal interest rate adjusts such that the associated real interest rate remains constant over time. In the first year, inflation is 2.75 percent and the nominal interest rate for both the fixed and variable rate loans is 5 percent. What is the real interest rate for the fixed rate loan? What about for the variable rate loan? In the second year, inflation rises to 3 percent. Calculate the nominal and real interest rates for the fixed rate and the variable rate loans…
QUESTION 29 The DoDo Bird Co., a U.S.-based MNC has applied the following regression model to estimate the sensitivity of its cash flows to exchange rate movements PCF; = ao + bęet + Ut Where the term on the left hand-side is the percentage change in the inflation adjusted cash flows measured in U.S. dollars over period t and eț is the percentage change in the exchange rate of the euro (versus the dollar; number of dollars required to buy one euro) over period t. The regression model estimates a coefficient of bt equal to 0.5. This indicates that: O a. If the euro appreciates by 1%, DoDo Bird's dollar cash flows will decline by .5%. O b. If the euro depreciates by 1%, DoDo Bird's dollar cash flows will increase by 2%. O c. If the euro depreciates by 1%, DoDo Bird's dollar cash flows will decrease by 2%. Od.If the euro depreciates by 1%, DoDo Bird's dollar cash flows will decline by .5%. O e. None of the above QUESTION 30 The 2017 Tax Cuts and Jobs Act: O a. Lowered corporate tax rate…

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