The table shows the components of money supply:ItemBillions of dollarsSmall time deposits630Large time deposits645Money market deposit accounts575Money market mutual funds425Checkable deposits448Noncheckable savings deposits300Currency170 Estimate the following:M1M2 Suppose that the natural rate of unemployment in a particular year is 5 percent and the actual rate of unemployment is 9 percent. Use Okun’s law to determine the size of the GDP gap in percentage-point terms. If the potential GDP is $500 billion in that year, how much output is being forgone because of cyclical unemployment? What is the major difference between a person who is frictionally unemployed and one who is structurally unemployed? What criteria must be met for a person to be characterized as unemployed? How is a discouraged worker different from an unemployed worker? Suppose there are 120 million people in the civilian labour force and 100 million people employed. How many people are unemployed? What is the unemployment rate? In the first quarter of the year, Real GDP was $400 billion; in the second quarter, it was $398 billion; in the third quarter, it was $399 billion; and in the fourth quarter, it was $395 billion. Has there been a recession? Explain your answer. Consumption spending is $3.708 trillion, spending on nondurable goods is $1.215 trillion, and spending on services is $2.041 trillion. What does spending on durable goods equal? Nondurablegoods spending = $400 million, durable goods spending = $300 million, new residential housing spending = $200 million, and spending on services = $500 million. What does consumption equal? If government intends to reduce the amount of supply in the system, explainthree practical steps he should take to achieve that. a. Explain how institutional factors promote economic growth in these areas: promotion of modern technologythe flow of resources to the most productive areas. Explain how expansionary fiscal policy works in an economy Suppose that the banking system in Ghana has a required reserve ratio of 10 percent while the banking system in the Ivory Coast has a required reserve ratio of 20 percent.In which country would $100 of initial excess reserves be able to cause a larger total amount of money creation? For the two countries, if an amount of $2000 each are deposited attwo separate ban banks in both countries and decides to give $600 asloans, what is the maximum amount of money that can be createdin both countries with that deposit With the aid of illustration (s) explain in detail why countries push forspecialization in international trade.

Frictional unemployment refers to a situation where an individual is shifting between employments…

Answered: What is the major difference between a…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The table shows the components of money supply:

Item	Billions of dollars
Small time deposits	630
Large time deposits	645
Money market deposit accounts	575
Money market mutual funds	425
Checkable deposits	448
Noncheckable savings deposits	300
Currency	170

Estimate the following:
1. M1
2. M2

Suppose that the natural rate of unemployment in a particular year is 5 percent and the actual rate of unemployment is 9 percent. Use Okun’s law to determine the size of the GDP gap in percentage-point terms. If the potential GDP is $500 billion in that year, how much output is being forgone because of cyclical unemployment?

What is the major difference between a person who is frictionally unemployed and one who is structurally unemployed?

What criteria must be met for a person to be characterized as unemployed?

How is a discouraged worker different from an unemployed worker?

Suppose there are 120 million people in the civilian labour force and 100

million people employed. How many people are unemployed? What is

the unemployment rate?

In the first quarter of the year, Real GDP was $400 billion; in the second

quarter, it was $398 billion; in the third quarter, it was $399 billion; and in the

fourth quarter, it was $395 billion. Has there been a recession? Explain your

answer.

Consumption spending is $3.708 trillion, spending on nondurable

goods is $1.215 trillion, and spending on services is $2.041 trillion. What does

spending on durable goods equal?

Nondurablegoods spending = $400 million, durable goods spending = $300

million, new residential housing spending = $200 million, and spending on

services = $500 million. What does consumption equal?

If government intends to reduce the amount of supply in the system, explain

three practical steps he should take to achieve that.

a. Explain how institutional factors promote economic growth in these areas:
promotion of modern technology
the flow of resources to the most productive areas.

Explain how expansionary fiscal policy works in an economy

Suppose that the banking system in Ghana has a required reserve ratio of 10

percent while the banking system in the Ivory Coast has a required reserve

ratio of 20 percent.

In which country would $100 of initial excess reserves be

able to cause a larger total amount of money creation?

For the two countries, if an amount of $2000 each are deposited at

two separate ban banks in both countries and decides to give $600 as

loans, what is the maximum amount of money that can be created

in both countries with that deposit

With the aid of illustration (s) explain in detail why countries push for

specialization in international trade.

Definition Definition Increase in the amount of goods and services produced by a country in a given period of time compared to an earlier period. Economic growth is generally coupled with a rise in national income or the purchasing power of individuals. It is often measured in terms of the increase in a country's gross domestic product (GDP), or the overall monetary value of all the complete or final services and goods that a country can produce within its domestic boundaries in a specific period.

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