Economics (7th Edition) (What's New in Economics)
7th Edition
ISBN: 9780134738321
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 25, Problem 25.5RDE
Subpart (a):
To determine
The average annual rate for both real GDP and M2.
Subpart (b):
To determine
The average annual rate for both real GDP and M2.
Subpart (c):
To determine
The average annual rate for both real GDP and M2.
Subpart (d):
To determine
The average annual rate for both real GDP and M2.
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3. Consider the following regression equation, where Cigs is daily spending on cigarettes in poundssterling (£), Y earsEduc is years of education, and F emale equals one if an individual is femaleand zero otherwise (standard errors in parentheses):Cigs [ = 4(1.6)− 0.08(0.032)Y earsEduc − 0.5(0.2)F emale,(a) Interpret the coefficients on Y earsEduc and F emale. (b) What does the model predict the average daily spending on cigarettes would be for womenwith 12 years of education? (c) Form the 95% confidence interval for the coefficient on F emale. (d) Economists are often interested in estimating production functions of the Cobb-Douglas form(Yiis the ith firm’s output, Liits spending on labour, and Kiits spending on capital):Yi = ALαi Kβi,How might someone estimate α and β from this equation using linear regression?
2. The demand and supply functions for two interdependent goods X and Y are givenbyQDX = 7 − 4PX + 2PYQSX = −6 + 4PX − PYQDY = 1 + PX − PYQSY = −4 − PX + 2PY(a) Find the market equilibrium condition for each good. (b) Express the equilibrium conditions in the matrix form Ax = b.(c) Find the inverse of matrix A. (d) Given your result in part (c), calculate the equilibrium prices. (e) What is the equilibrium quantity for goods X and Y ?
2. A two-sector macro-economic model satisfies the following structural equations:Y = C + I∗C = aY + bwhere 0 < a < 1 and b > 0 are parameters and I∗ denotes investment.(a) What are the exogenous and endogenous variables in this model? (b) Re-arrange this system of equations to express the endogenous variables in terms of the exogenous variables and parameters. (c) Express this system of equations in the matrix form Ax = b. (d) Show that the inverse of matrix A exists.
Chapter 25 Solutions
Economics (7th Edition) (What's New in Economics)
Ch. 25 - Prob. 25.1.1RQCh. 25 - Prob. 25.1.2RQCh. 25 - Prob. 25.1.3RQCh. 25 - Prob. 25.1.4RQCh. 25 - Prob. 25.1.5PACh. 25 - Prob. 25.1.6PACh. 25 - Prob. 25.1.7PACh. 25 - Prob. 25.1.8PACh. 25 - Prob. 25.1.9PACh. 25 - Prob. 25.2.1RQ
Ch. 25 - Prob. 25.2.2RQCh. 25 - Prob. 25.2.3PACh. 25 - Prob. 25.2.4PACh. 25 - Prob. 25.2.5PACh. 25 - Prob. 25.2.6PACh. 25 - Prob. 25.2.7PACh. 25 - Prob. 25.2.8PACh. 25 - Prob. 25.2.9PACh. 25 - Prob. 25.2.10PACh. 25 - Prob. 25.3.1RQCh. 25 - Prob. 25.3.2RQCh. 25 - Prob. 25.3.3RQCh. 25 - Prob. 25.3.4RQCh. 25 - Prob. 25.3.5PACh. 25 - Prob. 25.3.6PACh. 25 - Prob. 25.3.7PACh. 25 - Prob. 25.3.8PACh. 25 - Prob. 25.3.11PACh. 25 - Prob. 25.3.12PACh. 25 - Prob. 25.4.1RQCh. 25 - Prob. 25.4.2RQCh. 25 - Prob. 25.4.3RQCh. 25 - Prob. 25.4.4RQCh. 25 - Prob. 25.4.5PACh. 25 - Prob. 25.4.6PACh. 25 - Prob. 25.4.7PACh. 25 - Prob. 25.4.8PACh. 25 - Prob. 25.4.9PACh. 25 - Prob. 25.4.10PACh. 25 - Prob. 25.4.11PACh. 25 - Prob. 25.5.1RQCh. 25 - Prob. 25.5.2RQCh. 25 - Prob. 25.5.3RQCh. 25 - Prob. 25.5.4PACh. 25 - Prob. 25.5.5PACh. 25 - Prob. 25.5.6PACh. 25 - Prob. 25.5.7PACh. 25 - Prob. 25.5.8PACh. 25 - Prob. 25.5.9PACh. 25 - Prob. 25.5.10PACh. 25 - Prob. 25.1RDECh. 25 - Prob. 25.2RDECh. 25 - Prob. 25.3RDECh. 25 - Prob. 25.4RDECh. 25 - Prob. 25.5RDECh. 25 - Prob. 25.6RDE
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