The document provides information about an economics exam, including:
- It lasts 2 hours and is worth 60 marks
- Questions are drawn from pre-released material on the eurozone crisis and PIIGS economies
- Higher grades require analysis, evaluation and judgment in responses
- Answers should demonstrate knowledge, application, analysis and evaluation
- Diagrams are important for demonstrating concepts and analysis
A revision presentation offering ideas for stronger evaluation and analysis in your AS and A2 economics exam papers. Ten strands are suggested for students who want to build really good answers especially to evaluation questions.
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
call us at : 08263069601
CA NOTES ON BUSINESS ECONOMICS
FREE AFFIDAVITS AND NOTICES FORMATS
FREE AGREEMENTS AND CONTRACTS FORMATS
FREE LLB LAW NOTES
FREE CA ICWA NOTES
FREE LLB LAW FIRST SEM NOTES
FREE LLB LAW SECOND SEM NOTES
FREE LLB LAW THIRD SEM NOTES
FREE LLB LAW FOURTH SEM NOTES
FREE LLB LAW FIFTH SEM NOTES
FREE LLB LAW SIXTH SEM NOTES
FREE CA ICWA FOUNDATION NOTES
FREE CA ICWA INTERMEDIATE NOTES
FREE CA ICWA FINAL NOTES
KANOON KE RAKHWALE INDIA
HIRE LAWYER ONLINE
LAW FIRMS IN DELHI
CA FIRM DELHI
VISIT : https://www.kanoonkerakhwale.com/
VISIT : https://hirelawyeronline.com/
The course starts with a basic but rigorous introduction to economic concepts and tools of analysis. It then moves on to discuss introductory microeconomic supply and demand analysis and different market structures. The macroeconomic section of the course commences with the circular flow of income and the multiplier which are used as the bases of a discussion of the impact of government activity and foreign trade upon economic activity.
Dear students get fully solved SMU BBA Spring 2014 assignments
Send your semester & Specialization name to our mail id :
“ help.mbaassignments@gmail.com ”
or
Call us at : 08263069601
AS Macro Economics: Economic Cycle and Objectivestutor2u
In this session we are going to focus on the performance of
the UK economy over recent years and see how economic
growth appears to follow a cyclical pattern
ECO 202 Project Template
Economic Summary Report
Table of Contents
Introduction
Fiscal Policies: Taxation
Fiscal Policies: Government Expenditure
Monetary Policies
Global Context
Conclusions
References
Introduction
For the benefit of the incoming administration, I submit this report to document, analyze, and interpret the macroeconomic policy decisions I made as the chief economic policy advisor of Econland. The purpose of this document is to further our national prosperity by deepening our understanding of the relationship between macroeconomic policies and their consequences for our citizens. The report includes a thorough accounting of the major fiscal and monetary policy decisions made over each of the seven years of my term, as well as an explanation of the underlying rationales for those decisions and the resulting impacts of those policies.
Table 1.1
The table above summarizes the macroeconomic climate of Econland over my term. The scenario I ran was the “Base Case”. During my seven years as chief economic policy advisor, I was able to keep a high approval rating at 81% and kept the economy growing and kept the government expenditure constant while inflation stayed average.
Fiscal Policy: Taxation
Table 2.1
I kept my interest rates the same at 2.5 and adjusted my income tax by 4% and corporate tax by 1%. This decreased inflation by .5%. Because the GDP does not encompass all areas of income and purchases it is hard to track the actual growth. often this leads to lower taxes meaning high inflation, because even though people are keeping more of their income, subsequently other areas must raise their prices to make up for the lower taxes. So common goods often see a price increase when taxes are lowered. Having found that happy middle ground where there is a good balance between interest rates and income tax rates took me a few tries
Fiscal Policy: Government Expenditure
Figure 3.1
The first year I kept everything the same just to see the outcome of the first-year report. I took the data and made minor adjustments with lowering all taxes and keeping everything else the way it was. The idea behind this was if people can keep more in their pockets, they would spend more. The economy did grow at a high pace over one year my government deficit was large. My GDP grew from 1.0 to 6.3 and unemployment fell from 5.6 to 4.1. This means that production went up, demand went up, and people who were looking for jobs found them and started working in this first year.
References
Mankiw, N. G. (2021). Principles of economics (9th ed.). Cengage Learning.
ECO 202 Project Template
Economic Summary Report
[Throughout this template, replace the content in the bracketed text with your own responses, and delete any bracketed instructions, including these.]
[The Table of Contents and Introduction sections of your report are provided and should remain standard in all submissions.]
[The placeholders for your data visualizati ...
ECO 306 Final Project I Guidelines and Rubric Overvie.docxmadlynplamondon
ECO 306 Final Project I Guidelines and Rubric
Overview
The first final project for this course is the creation of an informative presentation. The presentation will analyze U.S. interest rate behavior over a 10- to 15-year
period during the last 50 years. Through your research, you will examine economic trends and risks, and the impact of monetary policy on interest rates.
This presentation will provide an opportunity for you to develop an understanding of interest rate behavior. By analyzing a sufficient period of time, you will
identify trends and changes in interest rates and witness the impact that key economic events have on interest rate determination. In doing this, you will
develop an appreciation of the relationship between policy targets and market factors, which impact economic activity. The final product will be submitted in
Module Three.
In this assignment, you will demonstrate your mastery of the following course outcomes:
Explain the determinants and behavior of interest rates as they relate to markets
Analyze the relationship between monetary policy and the economy for informing responsible business decision making
Prompt
For this final project, create a PowerPoint presentation of 8–10 slides analyzing U.S. interest rate behavior over a 10- to 15-year period during the last 50 years.
You will access information in the Federal Reserve Economic Database (FRED) and create a presentation that includes speaker notes and visual representations
of your findings.
Specifically, the following critical elements must be addressed:
I. Overview: Define the specific interest rates and time period that you are analyzing, and explain why you chose them.
II. Interest Rates
A. Explain interest rate trends over the time period and whether they have been high or low by historical standards.
B. Using FRED tools, visually illustrate changes in interest rates during the time period.
C. Describe economic risk factors that have impacted interest rates in the time period and what kind of impact they had. Consider bankruptcies,
financial crises, geopolitical factors, and so on.
D. Describe underlying economic conditions that impacted the activity of these interest rates during the time period.
III. Monetary Policy
A. Discuss the impact of interest rate changes on general business decision-making. Consider expanding or contracting operations, deciding to
undertake or postpone additions of capital (i.e., increasing productive capabilities), or increasing or decreasing inventories.
https://fred.stlouisfed.org/
B. Explain the causal relationship between the federal funds rate and market rates of interest.
C. Using your analysis of interest rates during the time period as a guide, explain the internal and external impacts on the economy.
Deliverable
Final Submission: Presentation
Submit your presentation in Module Three. It should be a complete, polished artifact containing all of the crit ...
AS Macro: The Effectiveness of UK Macro-Economic Policiestutor2u
We have considered the three key areas of macroeconomic policy – monetary policy, fiscal policy and supply-side policies.
In the longest essay questions on data response papers examiners often ask students to consider how effective these are when they are used to manage the economy. How can we judge whether the performance of the economy is improving as a result of them? In this session we will remember how to assess macroeconomic performance, think about some of the issues with measuring growth,
and focus on ways to evaluate the effectiveness of different policies
5.1 Assignment Reading and RemediationGetting Start.docxdomenicacullison
5.1 Assignment: Reading and Remediation
Getting Started
Viewing the videos and practicing using the practice Excel file with its video can prepare you for the work needed on the research report.
In order to successfully complete this exercise, you should be able to:
Review videos about statistics fundamentals.
Practice with the Excel file provided.
Resources
File: WS5Practice
File: WS5Homework
Video: Chi-Square
Video: Chi-Square Testing
Textbook:
OpenIntro Statistics
File: Chi-Square_10by10.xlsx
Background Information
Providing background and descriptive statistics is like a literature review section of a dissertation. You review and communicate the analysis on the raw data. You present visual representations of the data to give meaning to the raw data.
Instructions
Watch the following video on chi-square:
Watch the Excel remediation videos on chi-square testing:
Chi-Square Testing
using the
Chi-Square_10by10.xlsx
file.
An optional supplementary textbook is
OpenIntro Statistics
, and you can read the concepts there.
Use the lab file
WS5Practice
to practice the Excel skills (includes an Excel hands-on video inside the spreadsheet as a link).
Use the file
WS5Homework
to demonstrate the Excel skills. Each of the three problems is worth 20 points, for a total of 60 points possible for this assignment.
When you have completed your assignment, save a copy for yourself and submit a copy to your instructor by the end of the workshop.
=================================================
5.2 Assignment: Summarizing Raw Data
Getting Started
Being able to summarize data using pivot tables is a crucial skill to develop in business and research. Excel provides a powerful pivot table tool that is heavily used in finance, accounting, information technology, and other business areas. In this course, the skill is used to support a chi-square analysis.
In order to successfully complete this assignment, you should be able to:
Summarize data into a contingency table from raw data using pivot tables.
Resources
File: WS5-2_PivotTables
File: WS5-2_PivotAssignment
Instructions
Review the rubric to make sure you understand the criteria for earning your grade.
Read the file
WS5-2_PivotTables
.
After reading the Word document, open the file
WS5-2_PivotAssignment
.
Create the appropriate summary tables called contingency tables.
Turn in an Excel file showing the pivot table you have created.
When you have completed your assignment, save a copy for yourself and submit a copy to your instructor by the end of the workshop.
===============================================
5.4 Assignment: Create Categorical Hypothesis
Getting Started
After the prior activities, the analysis section can be written for the research report. Since there are three analyses to perform, this is a partial assignment for the analysis section.
In order to successfully complete this assignment, you should be able to:
Wri.
Time Value of Money Financial calculator functions .docxjuliennehar
Time Value of Money
*Financial calculator functions:
N I/Y PV PMT FV
Enter four of the five keys, and solve the 5th one.
*Excel functions:
Future value FV FV(rate, nper, pmt, pv)
Present value PV PV(rate, nper, pmt, fv)
Number of periods nper nper(rate, pmt, pv, fv)
Interest rate rate rate(nper, pmt, pv, fv)
Payment pmt pmt(rate, nper, pv, fv)
FV, PV, rate, nper, pmt
Enter four of the five parameters, and solve the 5th one.
Calculate Future Value
(1) Compute the future of $1000 compounded annually for 10 years at 6 percent.
1. Use the mathematical formula
To find the FV of a lump sum, we use:
FV = PV(1 + r)t
FV = $1,000(1.06)10 = $1,790.85
2. Use financial calculator
Enter 10 6 -1,000 0
N I/Y PV PMT FV
Solve for 1790.85
3. Use Excel Spreadsheet
FV(rate, nper, pmt, pv)
FV(0.06, 10, 0, -1000)= 1790.85
(2) Compute the future of $1000 compounded semiannually for 10 years at 6 percent.
1. Use the mathematical formula
To find the FV of a lump sum, we use:
𝐹𝑉 = 𝑃𝑉(1 +
𝑟
𝑚
)𝑡×𝑚
m=2, r =6%, t=10, PV=1000
FV = $1,000(1.03)20 = $1,806.11
2. Use financial calculator
Enter 20 3 -1,000 0
N I/Y PV PMT FV
Solve for 1806.11
3. Use Excel Spreadsheet
FV(rate, nper, pmt, pv)
FV(0.03, 20, 0, -1000)= 1806.11
Calculate Present Value
What is the present value of $500,000 to be received ten years from today if the discount rate is
6% annually?
1. Use the mathematical formula
To find the PV of a lump sum, we use:
𝑃𝑉 =
𝐹𝑉
(1+𝑟)𝑡
PV = 500000 / (1.06)10 = $279,197
2. Use financial calculator
Enter 10 6 0 500000
N I/Y PV PMT FV
Solve for -279,197
3. Use Excel Spreadsheet
PV(rate, nper, pmt, fv)
PV(0.06, 10, 0, 500000)= -279,197
Present value is $279,197.
Solve for the number of periods
How many years will it take for your initial investment of $7,752 to grow to $20,000 if it is
invested so that it earns 9% compounded annually?
1. Use the mathematical formula
FV = PV(1 + r)t
20,000 = 7,752(1.06)t = $1,790.85
FV=PV (1+i)n
N =ln (FV/PV) /ln (1+i)
N=ln (20,000/7,752) /ln (1.09)
N=11 years
2. Use financial calculator
Enter 9 -7,752 0 20,000
N I/Y PV PMT FV
Solve for 11
3. Use Excel Spreadsheet
nper(rate, pmt, pv, fv)
nper(0.09, 0, -7752, 20000)= 11
Solve for the interest rate, i
At what rate must your initial investment of $7,752 be compounded annually for it to grow to
$20,000 in 11 years?
1. Use the mathematical formula
FV = PV(1 + r)t
20,000 = 7,752(1+r)11
(1+r)11 = 2.58
1 + 𝑟 = √2.58
11
= 1.09
𝑟 = 0.09
2. Use financial calculator
Enter 11 -7,752 0 20,000
N I/Y PV PMT FV
Solve for 9
3. Use Excel Spreadsheet
rate(nper, pmt, pv, fv)
rate(11, 0, -7752, 20000) = 9%
Answer
A revision presentation offering ideas for stronger evaluation and analysis in your AS and A2 economics exam papers. Ten strands are suggested for students who want to build really good answers especially to evaluation questions.
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
call us at : 08263069601
CA NOTES ON BUSINESS ECONOMICS
FREE AFFIDAVITS AND NOTICES FORMATS
FREE AGREEMENTS AND CONTRACTS FORMATS
FREE LLB LAW NOTES
FREE CA ICWA NOTES
FREE LLB LAW FIRST SEM NOTES
FREE LLB LAW SECOND SEM NOTES
FREE LLB LAW THIRD SEM NOTES
FREE LLB LAW FOURTH SEM NOTES
FREE LLB LAW FIFTH SEM NOTES
FREE LLB LAW SIXTH SEM NOTES
FREE CA ICWA FOUNDATION NOTES
FREE CA ICWA INTERMEDIATE NOTES
FREE CA ICWA FINAL NOTES
KANOON KE RAKHWALE INDIA
HIRE LAWYER ONLINE
LAW FIRMS IN DELHI
CA FIRM DELHI
VISIT : https://www.kanoonkerakhwale.com/
VISIT : https://hirelawyeronline.com/
The course starts with a basic but rigorous introduction to economic concepts and tools of analysis. It then moves on to discuss introductory microeconomic supply and demand analysis and different market structures. The macroeconomic section of the course commences with the circular flow of income and the multiplier which are used as the bases of a discussion of the impact of government activity and foreign trade upon economic activity.
Dear students get fully solved SMU BBA Spring 2014 assignments
Send your semester & Specialization name to our mail id :
“ help.mbaassignments@gmail.com ”
or
Call us at : 08263069601
AS Macro Economics: Economic Cycle and Objectivestutor2u
In this session we are going to focus on the performance of
the UK economy over recent years and see how economic
growth appears to follow a cyclical pattern
ECO 202 Project Template
Economic Summary Report
Table of Contents
Introduction
Fiscal Policies: Taxation
Fiscal Policies: Government Expenditure
Monetary Policies
Global Context
Conclusions
References
Introduction
For the benefit of the incoming administration, I submit this report to document, analyze, and interpret the macroeconomic policy decisions I made as the chief economic policy advisor of Econland. The purpose of this document is to further our national prosperity by deepening our understanding of the relationship between macroeconomic policies and their consequences for our citizens. The report includes a thorough accounting of the major fiscal and monetary policy decisions made over each of the seven years of my term, as well as an explanation of the underlying rationales for those decisions and the resulting impacts of those policies.
Table 1.1
The table above summarizes the macroeconomic climate of Econland over my term. The scenario I ran was the “Base Case”. During my seven years as chief economic policy advisor, I was able to keep a high approval rating at 81% and kept the economy growing and kept the government expenditure constant while inflation stayed average.
Fiscal Policy: Taxation
Table 2.1
I kept my interest rates the same at 2.5 and adjusted my income tax by 4% and corporate tax by 1%. This decreased inflation by .5%. Because the GDP does not encompass all areas of income and purchases it is hard to track the actual growth. often this leads to lower taxes meaning high inflation, because even though people are keeping more of their income, subsequently other areas must raise their prices to make up for the lower taxes. So common goods often see a price increase when taxes are lowered. Having found that happy middle ground where there is a good balance between interest rates and income tax rates took me a few tries
Fiscal Policy: Government Expenditure
Figure 3.1
The first year I kept everything the same just to see the outcome of the first-year report. I took the data and made minor adjustments with lowering all taxes and keeping everything else the way it was. The idea behind this was if people can keep more in their pockets, they would spend more. The economy did grow at a high pace over one year my government deficit was large. My GDP grew from 1.0 to 6.3 and unemployment fell from 5.6 to 4.1. This means that production went up, demand went up, and people who were looking for jobs found them and started working in this first year.
References
Mankiw, N. G. (2021). Principles of economics (9th ed.). Cengage Learning.
ECO 202 Project Template
Economic Summary Report
[Throughout this template, replace the content in the bracketed text with your own responses, and delete any bracketed instructions, including these.]
[The Table of Contents and Introduction sections of your report are provided and should remain standard in all submissions.]
[The placeholders for your data visualizati ...
ECO 306 Final Project I Guidelines and Rubric Overvie.docxmadlynplamondon
ECO 306 Final Project I Guidelines and Rubric
Overview
The first final project for this course is the creation of an informative presentation. The presentation will analyze U.S. interest rate behavior over a 10- to 15-year
period during the last 50 years. Through your research, you will examine economic trends and risks, and the impact of monetary policy on interest rates.
This presentation will provide an opportunity for you to develop an understanding of interest rate behavior. By analyzing a sufficient period of time, you will
identify trends and changes in interest rates and witness the impact that key economic events have on interest rate determination. In doing this, you will
develop an appreciation of the relationship between policy targets and market factors, which impact economic activity. The final product will be submitted in
Module Three.
In this assignment, you will demonstrate your mastery of the following course outcomes:
Explain the determinants and behavior of interest rates as they relate to markets
Analyze the relationship between monetary policy and the economy for informing responsible business decision making
Prompt
For this final project, create a PowerPoint presentation of 8–10 slides analyzing U.S. interest rate behavior over a 10- to 15-year period during the last 50 years.
You will access information in the Federal Reserve Economic Database (FRED) and create a presentation that includes speaker notes and visual representations
of your findings.
Specifically, the following critical elements must be addressed:
I. Overview: Define the specific interest rates and time period that you are analyzing, and explain why you chose them.
II. Interest Rates
A. Explain interest rate trends over the time period and whether they have been high or low by historical standards.
B. Using FRED tools, visually illustrate changes in interest rates during the time period.
C. Describe economic risk factors that have impacted interest rates in the time period and what kind of impact they had. Consider bankruptcies,
financial crises, geopolitical factors, and so on.
D. Describe underlying economic conditions that impacted the activity of these interest rates during the time period.
III. Monetary Policy
A. Discuss the impact of interest rate changes on general business decision-making. Consider expanding or contracting operations, deciding to
undertake or postpone additions of capital (i.e., increasing productive capabilities), or increasing or decreasing inventories.
https://fred.stlouisfed.org/
B. Explain the causal relationship between the federal funds rate and market rates of interest.
C. Using your analysis of interest rates during the time period as a guide, explain the internal and external impacts on the economy.
Deliverable
Final Submission: Presentation
Submit your presentation in Module Three. It should be a complete, polished artifact containing all of the crit ...
AS Macro: The Effectiveness of UK Macro-Economic Policiestutor2u
We have considered the three key areas of macroeconomic policy – monetary policy, fiscal policy and supply-side policies.
In the longest essay questions on data response papers examiners often ask students to consider how effective these are when they are used to manage the economy. How can we judge whether the performance of the economy is improving as a result of them? In this session we will remember how to assess macroeconomic performance, think about some of the issues with measuring growth,
and focus on ways to evaluate the effectiveness of different policies
5.1 Assignment Reading and RemediationGetting Start.docxdomenicacullison
5.1 Assignment: Reading and Remediation
Getting Started
Viewing the videos and practicing using the practice Excel file with its video can prepare you for the work needed on the research report.
In order to successfully complete this exercise, you should be able to:
Review videos about statistics fundamentals.
Practice with the Excel file provided.
Resources
File: WS5Practice
File: WS5Homework
Video: Chi-Square
Video: Chi-Square Testing
Textbook:
OpenIntro Statistics
File: Chi-Square_10by10.xlsx
Background Information
Providing background and descriptive statistics is like a literature review section of a dissertation. You review and communicate the analysis on the raw data. You present visual representations of the data to give meaning to the raw data.
Instructions
Watch the following video on chi-square:
Watch the Excel remediation videos on chi-square testing:
Chi-Square Testing
using the
Chi-Square_10by10.xlsx
file.
An optional supplementary textbook is
OpenIntro Statistics
, and you can read the concepts there.
Use the lab file
WS5Practice
to practice the Excel skills (includes an Excel hands-on video inside the spreadsheet as a link).
Use the file
WS5Homework
to demonstrate the Excel skills. Each of the three problems is worth 20 points, for a total of 60 points possible for this assignment.
When you have completed your assignment, save a copy for yourself and submit a copy to your instructor by the end of the workshop.
=================================================
5.2 Assignment: Summarizing Raw Data
Getting Started
Being able to summarize data using pivot tables is a crucial skill to develop in business and research. Excel provides a powerful pivot table tool that is heavily used in finance, accounting, information technology, and other business areas. In this course, the skill is used to support a chi-square analysis.
In order to successfully complete this assignment, you should be able to:
Summarize data into a contingency table from raw data using pivot tables.
Resources
File: WS5-2_PivotTables
File: WS5-2_PivotAssignment
Instructions
Review the rubric to make sure you understand the criteria for earning your grade.
Read the file
WS5-2_PivotTables
.
After reading the Word document, open the file
WS5-2_PivotAssignment
.
Create the appropriate summary tables called contingency tables.
Turn in an Excel file showing the pivot table you have created.
When you have completed your assignment, save a copy for yourself and submit a copy to your instructor by the end of the workshop.
===============================================
5.4 Assignment: Create Categorical Hypothesis
Getting Started
After the prior activities, the analysis section can be written for the research report. Since there are three analyses to perform, this is a partial assignment for the analysis section.
In order to successfully complete this assignment, you should be able to:
Wri.
Time Value of Money Financial calculator functions .docxjuliennehar
Time Value of Money
*Financial calculator functions:
N I/Y PV PMT FV
Enter four of the five keys, and solve the 5th one.
*Excel functions:
Future value FV FV(rate, nper, pmt, pv)
Present value PV PV(rate, nper, pmt, fv)
Number of periods nper nper(rate, pmt, pv, fv)
Interest rate rate rate(nper, pmt, pv, fv)
Payment pmt pmt(rate, nper, pv, fv)
FV, PV, rate, nper, pmt
Enter four of the five parameters, and solve the 5th one.
Calculate Future Value
(1) Compute the future of $1000 compounded annually for 10 years at 6 percent.
1. Use the mathematical formula
To find the FV of a lump sum, we use:
FV = PV(1 + r)t
FV = $1,000(1.06)10 = $1,790.85
2. Use financial calculator
Enter 10 6 -1,000 0
N I/Y PV PMT FV
Solve for 1790.85
3. Use Excel Spreadsheet
FV(rate, nper, pmt, pv)
FV(0.06, 10, 0, -1000)= 1790.85
(2) Compute the future of $1000 compounded semiannually for 10 years at 6 percent.
1. Use the mathematical formula
To find the FV of a lump sum, we use:
𝐹𝑉 = 𝑃𝑉(1 +
𝑟
𝑚
)𝑡×𝑚
m=2, r =6%, t=10, PV=1000
FV = $1,000(1.03)20 = $1,806.11
2. Use financial calculator
Enter 20 3 -1,000 0
N I/Y PV PMT FV
Solve for 1806.11
3. Use Excel Spreadsheet
FV(rate, nper, pmt, pv)
FV(0.03, 20, 0, -1000)= 1806.11
Calculate Present Value
What is the present value of $500,000 to be received ten years from today if the discount rate is
6% annually?
1. Use the mathematical formula
To find the PV of a lump sum, we use:
𝑃𝑉 =
𝐹𝑉
(1+𝑟)𝑡
PV = 500000 / (1.06)10 = $279,197
2. Use financial calculator
Enter 10 6 0 500000
N I/Y PV PMT FV
Solve for -279,197
3. Use Excel Spreadsheet
PV(rate, nper, pmt, fv)
PV(0.06, 10, 0, 500000)= -279,197
Present value is $279,197.
Solve for the number of periods
How many years will it take for your initial investment of $7,752 to grow to $20,000 if it is
invested so that it earns 9% compounded annually?
1. Use the mathematical formula
FV = PV(1 + r)t
20,000 = 7,752(1.06)t = $1,790.85
FV=PV (1+i)n
N =ln (FV/PV) /ln (1+i)
N=ln (20,000/7,752) /ln (1.09)
N=11 years
2. Use financial calculator
Enter 9 -7,752 0 20,000
N I/Y PV PMT FV
Solve for 11
3. Use Excel Spreadsheet
nper(rate, pmt, pv, fv)
nper(0.09, 0, -7752, 20000)= 11
Solve for the interest rate, i
At what rate must your initial investment of $7,752 be compounded annually for it to grow to
$20,000 in 11 years?
1. Use the mathematical formula
FV = PV(1 + r)t
20,000 = 7,752(1+r)11
(1+r)11 = 2.58
1 + 𝑟 = √2.58
11
= 1.09
𝑟 = 0.09
2. Use financial calculator
Enter 11 -7,752 0 20,000
N I/Y PV PMT FV
Solve for 9
3. Use Excel Spreadsheet
rate(nper, pmt, pv, fv)
rate(11, 0, -7752, 20000) = 9%
Answer
Presentation Title
Your Name
ECO 202
Milestone One
ECO 202
Choose a title for your presentation.
Include your name, the course name and the assignment name.
1
Ten-Year Period of U.S. Economic History Overview
This slide should include a brief overview of the 10-year period between 1950 and today that you chose for this presentation.
ECO 202
Write a brief overview of the time period you chose.
To give greater impact make sure to be brief in the slide and explain in the speaker’s notes.
Imagine that you have to present the PPT to an audience.
The slides are an outline for the audience to follow your presentation.
The speaker’s notes would be what you are going to say.
2
GDP (1–2 slides)
Gross Domestic Product (GDP) and Growth
Show a graph of real GDP growth rates for each year of your decade and highlight significant changes in growth rates, such as dips or negative growth (recession) or booms (economic expansion)
Real GDP data can be found here at FRED, the research database of the St. Louis Federal Reserve – adjust the data to your 10 year period and use these numbers to calculate the growth rate
Here is a video to introduce you to using the FRED site
Choose two or three of the most relevant events from this time period that impacted the U.S. economy. Apply specific models developed throughout the course to demonstrate how these events influenced national output during this time period.
You can use the GDP formula to explain how an event impacted GDP growth. For instance, if there was large increase in military spending because of a war, we would expect to see an increase in GDP.
Be sure the connections you make are supported by the data you present.
ECO 202
Start with the first topic you want to present.
First research the main idea you want to talk about, research sources, images/graphs/diagrams/tables.
Try to express the main concepts in a brief manner, such as bullet points, images with key words.
Explain the slide in the speaker’s notes.
3
Unemployment and Inflation (1–2 slides)
Analyze unemployment and inflation data as to their relation to output and growth, using macroeconomic principles and models to explain their effect.
Show graphs of both annual inflation rates and annual unemployment rates throughout your decade.
Find data on inflation rates here
Find data on unemployment here
Explain how inflation and unemployment are calculated for the data presented
Discuss how changes in both are related to changes in GDP growth
Apply specific models developed throughout the course to demonstrate how the previously selected events influenced both unemployment and inflation during this time period.
Discuss how the events impacted both economic indicators
For the final draft, look to include our AD-AS model to illustrate how events led the changes observed in both
ECO 202
Make sure to include speaker’s notes.
4
Interest Rates (1–2 slides)
Analyze interest rate fluctuations throughout this time period and their eff.
1. Please visit the following link on the Economist.com and an.docxjackiewalcutt
1. Please visit the following link on the Economist.com and answer the following three questions based
on data from any of the tables here. (There are about half a dozen tables linked under “economic and
financial indicators” on the right side of the page. These tables contain data on output, prices, wages,
inflation, interest rates etc.)
http://www.economist.com/markets-data
For the purposes of answering these questions, assume that interest rates refer to the annual rates on
10-year government bonds. If necessary, please state any other assumptions. Based on Britain (₤)
and Canada (C$):
a. For practical purposes, does real interest rate parity exist between these two countries? Please
show me your calculations.
b. Compared to last year, has the C$ appreciated or depreciated against the pound, and by how
much? (Please provide your reasoning and computations). Is this what you would expect based
on your answer to part a? Explain your reasoning.
c. Identify any two other factors from the tables that, in general, predict exchange rate appreciation
or depreciation, and determine if the appreciation or depreciation of the C$ is consistent with
what you might predict
2. In general, several variables appear to affect the future value of a currency. Everything else being
equal, with reference to the home country, clearly explain in a couple of sentences how each of the
following variables are likely to appreciate or depreciate the country’s currency: (please think
carefully before you answer these questions). (6 points)
a. Increase in GDP/output
b. Increase in money supply (M)
c. Increase in nominal interest rate (In)
d. Increase in real interest rate (Ir)
e. Increase in inflation
f. Increase in current account surplus
3. Compare and contrast home replication, global, transnational and multi-domestic strategies. Please
provide some examples of each type of strategy in your discussion. Please ensure that your
discussion contains an understanding of the conditions under which each strategy might be considered
appropriate.
2 points
2 points
2 points
2 points
3 points
4. You are considering exchanging Swiss Francs (SF) for Japanese Yen (Y). At the bank, you see the
following rates posted. (Please note that for full credit, you must show the steps to the correct answer
clearly and cleanly, not just the final answer.)
SF/$ = 0.9154 Y/$ = 100.26
a. What is the Y/SF exchange rate?
b. What is the SF/Y exchange rate?
c. If the SF appreciated by 10% what would then new rate be?
d. If the Yen depreciated by 25% relative to the original exchange rate (i.e. answer to part a, or
part b), what would the new rate be?
5. In recent months, several emerging markets such as India, Indonesia, Brazil and to a lesser extent
Brazil have seen a sharp depreciation of their currencies against the US dollar, as well as an increase
in volatility of their markets. In orde ...
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ECO 202
The 1960’s
Juan Aviles
ECO 202
Milestone One
Choose a title for your presentation.
Include your name, the course name and the assignment name.
*
ECO 202
Ten-Year Period of U.S. Economic History OverviewThis slide should include a brief overview of the 10-year period between 1950 and today that you chose for this presentation.
Write a brief overview of the time period you chose.
To give greater impact make sure to be brief in the slide and explain in the speaker’s notes.
Imagine that you have to present the PPT to an audience.
The slides are an outline for the audience to follow your presentation.
The speaker’s notes would be what you are going to say.
*
ECO 202
GDP (1–2 slides)Gross Domestic Product (GDP) and GrowthAnalyze the annual GDP to calculate specific growth rates and trends in the U.S. economy.Choose two or three of the most relevant events from this time period that impacted the U.S. economy. Apply specific models developed throughout the course to demonstrate how these events influenced national output during this time period.
Start with the first topic you want to present.
First research the main idea you want to talk about, research sources, images/graphs/diagrams/tables.
Try to express the main concepts in a brief manner, such as bullet points, images with key words.
Explain the slide in the speaker’s notes.
*
ECO 202
Unemployment and Inflation (1–2 slides)Apply specific models developed throughout the course to demonstrate how the previously selected events influenced both unemployment and inflation during this time period. Analyze unemployment and inflation data as to their relation to output and growth, using macroeconomic principles and models to explain their effect.
Make sure to include speaker’s notes.
*
ECO 202
Interest Rates (1–2 slides)
Analyze interest rate fluctuations throughout this time period and their effects on other aspects of the economy:
How would these fluctuations affect inflation?
Would investments and foreign trade rates increase or decrease?
How would the GDP of the American economy be affected?
Include Speaker’s notes.
*
ECO 202
Conclusions
Briefly draw conclusions based on the information gathered.
Speaker’s notes.
*
ECO 202
ReferencesInclude references in APA style.
*
ECO 202 Milestone One Guidelines and Rubric: Macroeconomic Data Report
Choose a 10-year period in the history of the United States between 1950 and today. All responses will be related to that timeframe.
a) Analyze the annual GDP to calculate specific growth rates and trends in the U.S. economy.
b) Analyze unemployment and inflation data.
c) Analyze interest rate fluctuations throughout this time period and their effects on other aspects of the economy.
Using the Milestone One PowerPoint Template provided, create 4–6 slides that address the following critical elements:
I. Examination of Macroeconomic Data (Be sure to include speaker notes to accompany all of yo ...
Page 1 of 7 Fin516 201830 Assessment 2 Value 30.docxkarlhennesey
Page 1 of 7
Fin516 201830 Assessment 2
Value: 30%
Due date: 17-April-2018
Submission method options: Turitin
Task – Answer all questions.
Question 1 45 marks
Corning Limited, one of the leading glass producers, is currently evaluating a potential new
product; a tough but light curved glass designed for unusually shaped tall buildings and office
blocks. The new product would cost more than their usual commercial exterior glasses and in
market research conducted by the company’s research department at a cost of $650,000 it
was judged superior to various competing products. Monica Andrews, the Chief Financial
Officer, must analyse this project, along with other potential investments, and then present
her findings to the company’s executive committee.
The project will require construction of a new plant that would have an annual capacity of
75,000 tons and will cost an estimated $18,500,000 to build. The estimated purchase cost of
machinery is $13,500,000 but shipping costs to move the machinery to the plant would total
$425,000 and the estimated installation charge is another $575,000.The land on which the
plant will be built has been vacant since it was bought three years ago at a cost of $750,000,
which has already been paid and expensed for tax purposes.
The company expects its new plant to produce 65,000 tons of glass per year and the
management of Corning anticipates they can sell the product at $350 per ton allowing the
company to gain 10% market share in the first year of operation. Fixed costs are expected to
average $12,500,000 annually while variable costs are estimated to be around $125 per ton.
The plant and machinery will be depreciated to zero on a straight-line basis over ten years,
with an estimated sale value of $1,000,000 after 10 years at the end of the project.
Corning requires 11.5% return on the project. The company tax rate is 30%.
Now assume that you are an assistant to Monica and she has asked you to analyse the project
and then to present your findings to her. Therefore,
a. Calculate the project’s incremental cash flow for each year and present in a tabular form.
15 marks
b. Using the incremental cash flows calculate the project’s:
i. Payback Period 1.5 marks
ii. Net Present Value 5 marks
iii. Profitability Index 2 marks
iv. Discounted Payback Period 1.5 marks
v. Internal Rate of Return using interpolation method 7 marks
c. Identify and discuss any further information that you may requ ...
ECO 202 Milestone Three Guidelines and Rubric Monetary Pol.docxMARRY7
ECO 202 Milestone Three Guidelines and Rubric: Monetary Policies
Continue your observation of the 10-year period selected for Milestones One and Two, and research the government monetary policies during that timeframe.
Specifically, the following critical elements must be addressed:
Examine the monetary policies in place at the start of your specific time period in relation to their effects on macroeconomic issues. For instance,
consider the discount rate set by the Fed, the rates on reserves, open market operations, and so on.
Analyze new monetary policy actions undertaken by the U.S. government throughout the time period by describing their intended effects, using
macroeconomic principles to explain the actions.
Explain the impact of the new monetary policy actions on individuals and businesses within the economy by integrating the macroeconomic data and
principles.
Guidelines for Submission: Your monetary policies milestone should be 3–5 slides, not including title or reference slides, and include speaker notes to
accompany the slides. Your reference list slide needs to be in APA format.
Instructor Feedback: This activity uses an integrated rubric in Blackboard. Students can view instructor feedback in the Grade Center. For more information,
review these instructions.
Critical Elements Proficient (100%) Needs Improvement (75%) Not Evident (0%) Value
Monetary Policies
Examines the monetary policies in
place at the start of the selected
time period in relation to their
effects on macroeconomic issues,
and provides information in speaker
notes
Examines the monetary policies in
place at the start of the selected
time period, but does not relate
them to their effects on
macroeconomic issues, or does not
provide information in speaker
notes
Does not examine the monetary
policies in place at the start of the
selected time period
30
Policy Actions
Analyzes new monetary policy
actions undertaken by the U.S.
government throughout the time
period by describing their intended
effects, uses macroeconomic
principles to explain the actions,
and provides information in speaker
notes
Analyzes new monetary policy
actions undertaken by the U.S.
government throughout the time
period, but does not describe their
intended effects, does not use
macroeconomic principles to
explain the actions, or does not
provide information in speaker
notes
Does not analyze new monetary
policy actions undertaken by the
U.S. government throughout the
time period
30
http://snhu-media.snhu.edu/files/production_documentation/formatting/rubric_feedback_instructions_student.pdf
Impact
Comprehensively explains the
impact of the new monetary policy
actions on individuals and
businesses within the economy by
integrating the macroeconomic
data and principles, and provides
information in speaker notes
Explains the impact of the new
monetary policy actions on
individuals and bus ...
Model Attribute Check Company Auto PropertyCeline George
In Odoo, the multi-company feature allows you to manage multiple companies within a single Odoo database instance. Each company can have its own configurations while still sharing common resources such as products, customers, and suppliers.
Macroeconomics- Movie Location
This will be used as part of your Personal Professional Portfolio once graded.
Objective:
Prepare a presentation or a paper using research, basic comparative analysis, data organization and application of economic information. You will make an informed assessment of an economic climate outside of the United States to accomplish an entertainment industry objective.
Unit 8 - Information and Communication Technology (Paper I).pdfThiyagu K
This slides describes the basic concepts of ICT, basics of Email, Emerging Technology and Digital Initiatives in Education. This presentations aligns with the UGC Paper I syllabus.
Biological screening of herbal drugs: Introduction and Need for
Phyto-Pharmacological Screening, New Strategies for evaluating
Natural Products, In vitro evaluation techniques for Antioxidants, Antimicrobial and Anticancer drugs. In vivo evaluation techniques
for Anti-inflammatory, Antiulcer, Anticancer, Wound healing, Antidiabetic, Hepatoprotective, Cardio protective, Diuretics and
Antifertility, Toxicity studies as per OECD guidelines
Honest Reviews of Tim Han LMA Course Program.pptxtimhan337
Personal development courses are widely available today, with each one promising life-changing outcomes. Tim Han’s Life Mastery Achievers (LMA) Course has drawn a lot of interest. In addition to offering my frank assessment of Success Insider’s LMA Course, this piece examines the course’s effects via a variety of Tim Han LMA course reviews and Success Insider comments.
Embracing GenAI - A Strategic ImperativePeter Windle
Artificial Intelligence (AI) technologies such as Generative AI, Image Generators and Large Language Models have had a dramatic impact on teaching, learning and assessment over the past 18 months. The most immediate threat AI posed was to Academic Integrity with Higher Education Institutes (HEIs) focusing their efforts on combating the use of GenAI in assessment. Guidelines were developed for staff and students, policies put in place too. Innovative educators have forged paths in the use of Generative AI for teaching, learning and assessments leading to pockets of transformation springing up across HEIs, often with little or no top-down guidance, support or direction.
This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
2. The examination for this unit is based on pre-released material In July 2011 the material concerns the problems of the PIIGS The exam lasts for 2 hours and there are 60 marks available This gives roughly 2 minutes per mark - don’t spend lots of time on low mark questions All questions are compulsory The mark allocation for the individual questions on the paper are as follows 1(a) 4 marks 1(b) 6 marks 1(c) 10 marks 2(a) 4 marks 2(b) 6 marks 2(c) 10 marks 3 20 marks
3. With most exam boards The following are required to achieve a particular grade: Grade A* - 90% = 72 marks Grade A - 80% = 64 marks Grade B - 70% = 56 marks Grade C - 60% = 48 marks Grade D - 50% = 40 marks Grade E - 40% = 32 marks
4. The pre-release material has 4 extracts: Extract 1: Recession in the euro area economies 2008 – 2009 Extract 2: Portugal, Italy, Ireland, Greece and Spain – the PIIGS Extract 3: The future of the Spanish economy Extract 4: International trade, international trade negotiations and developing economies A few general observations to assist examiners around my age Write clearly and use black ink – Economics examiners are elderly and myopic Never attempt to correct a diagram – clearly cross it out and draw it again Draw diagrams neatly and large (you are not paying for the paper) Always use a ruler/your debit card – it gives a better impression to the examiner Questions will be drawn from all areas and you must be prepared using your knowledge gained from the course to answer them
5. With essay type questions there are 5 levels The paper is synoptic: This means that you can be tested on anything you have done in economics Level 4 (a) 16-20 marks – requires excellent analysis, evaluation and includes a final paragraph giving a judgement on the question asked Level 4 (b) 11-15 marks - a balanced discussion of the question but without the level of evaluation & final judgement shown in 4(a) Level 3 5-10 marks – some analysis but is likely to be weak and one sided Level 2 3-4 marks – some application of knowledge and understanding of the question but lacking economic analysis Level 1 1-2 marks - For limited knowledge and understanding
6. The level achieved and the mark obtained within the level is determined by the quality of the answer as judged against 4 criteria Markers are required to identify these criteria as they occur in the response Criteria Knowledge and Understanding (K) – of concepts, appropriate economic terminology, definitions and theories relevant to the Q Application (Ap) –applying the data given in the texts to the economic theories, terminology, concepts relevant to the question Application (Ap) in the essay Qs involves making reference to the experience of the UK, EU or world economies Remember in the global paper you are supposed to have a knowledge of UK economic experience and performance over the past 10 years Analysis (An) – this is where you build up your argument, explaining and developing your theories and arguments and proving a logical chain of reasoning leading to your conclusion Diagrams and any formula constitute analysis
7. Judgement/Evaluation (E) – here, you will look at alternative points of view or consider occasions/circumstances in which there may be different outcomes In your evaluation you should make extensive use of words/phrases such as “as compared to”, “whereas”, “however”, “on the other hand” Make comparisons explicit not implicit – an evaluative statement E.g. “Whilst on the one hand UK membership of the Euro would reduce the risk to UK importers and exporters of exchange rate fluctuations it would mean that the UK would lose the valuable ability to control the domestic economy through adjustments to interest rates”
8. To score a high mark – Levels 4 and Answer the question set, not the question you wish had been set All 4 criteria must be addressed to some extent Good An and E applied to the Q and making use of the data provided is essential & you need to spend most time on questions that reward thi Failure to provide evaluation/judgement will reduce your marks Make extensive use of diagrams throughout – these will score high on An and enable you to present theories clearly and concisely If in doubt of the relevance of a diagram put it in – you will not lose anything Examiners use the phrase “evaluative tone” which applies to the overall presentation of an answer It is better to provide E throughout your response (using the key words and phrases), rather than attempt all your E at the end
9.
10. How to apply the criteria Assume the following question: The Extract (lines 35-36) argues that 'a more ambitious set of common macro-economic policies would help speed recovery in the Eurozone'. Using the data and your economic knowledge, assess the impact on the UK economy of recovery in the Eurozone as a whole. (25 marks) “ Macro economic policies are designed to...” (explain that they are designed to stabilise and increase GDP in the economy) (K) “ Recovery would mean closing the negative output gap..” (K) “ As Extract A indicates current macro policies have led to slower rates of growth” (Ap) (Analysis could take many forms, e.g)
11. The implications for economic growth The impact on employment/unemployment – possible diagram to cover 1 st two points The consequences for the balance of payments on current account The effects on the £/€ exchange rate The greater likelihood of avoiding a period of deflation The dangers of inflationary pressures building up The further development of the SEM in a period of recovery and increasing prosperity
12. Evaluation could come in the form of: The possible significance of a slow recovery – could mention PIIGS at this stage The possible supply problems if recovery is too rapid Whether the UK can take advantage of EU recovery Whether the advantage lies more with the rest of the EU in terms of exporting to the UK than for the UK exporting to the rest of the EU The significance of EU recovery for the UK relative to recovery taking place elsewhere in the world, i.e. in markets which have significance for the UK Whether or not recovery has implications for the movement of labour in and out of the UK and how this affects the UK labour market Now provide a final conclusion/judgement which could be along the lines of: Whether increased economic activity in the eurozone would or would not have A beneficial or negative effect
14. Recession in the Euro area economies Introduction Key terms: Recession – 2 quarters ( 6 months) of negative growth – a diagram opportunity is presented GDP 0 Time Trend Actual A Z X
15. Convergence in economic cycles The lack of convergence of economic cycles means that countries in the Euro Area were not at the same stages of their business cycle - Boom Slowdown Recession Recovery The problem faced by the European central bank – setting the Rate of interest (ROI) This lack of convergence really gets to the heart of the problem of the PIIGS GDP 0 Time Convergence Spain Germany Needs increasing ROI Needs falling ROI A
16.
17. Real convergence indicators: Trend growth rate of GDP Labour market - structural unemployment - NAIRU Growth of labour productivity – i.e. output per person employed Trade balances - share of GDP taken up by trade Capital investment as a share of GDP Housing market - rates of home ownership and the size of the rented property sector Cost/price competitiveness - index of relative unit labour costs in manufacturing industry and annual changes in output prices Importance of convergence Necessary to occur if the Eurozone is to be a optimal currency area (OCA) A key point to consider here in any judgement is could the PIIGS have created convergence by following deflationary policies or would it have been politically impossible? A case of government failure?
18. While not specifically mentioned in the specification the theory of an Optimal Currency Area provides and analytical frame work through which to view the PIIGS Remember you will not be penalised by examiners for having extra knowledge and understanding – just a lack of it What is a OCA? The following may help you to grasp the essentials: A geographical region in which it would maximize economic efficiency to have the entire region share a single currency - where the benefits of a single currency outweigh the disadvantages Assume Wales experiences an asymmetric shock (coal mines close down) Causes recession in Welsh economy - ↑ unemployment ↓ inflation As a separate entity Wales would ↓ ROI and depreciate its currency But in reality unemployed Welsh workers can move to Midlands or London
19. UK firms can invest in Wales to take advantage of lower labour costs and surplus labour There are not many geographical barriers to moving between areas within the UK. Now assume asymmetric shock in Greece: More difficult for Greek workers to move to Germany language barriers attachment to native country poor information regarding job availability etc German firms would have much more reluctance to invest in Greece due to language difficulties and poor perception of the Greek work ethic and inappropriate fiscal policies So there may be a difference between the UK and EU as a OCR as indicated below
20.
21. 2. Openness Capital mobility and price and wage flexibility across the region Market forces automatically distribute money and goods to where they are needed Does not work perfectly as there is no true wage flexibility in the Eurozone 3. Automatic fiscal transfer mechanism To redistribute money to areas/sectors which have been adversely affected Usually takes the form of taxation redistribution Politically difficult to implement - better-off regions rarely give up their revenue easily Current EU arrangements ad-hoc and not built in
22.
23. The OCR theory prompts the following question How far do you agree with the view that countries that are not economically convergent should not be allowed inside the single currency area? 20 marks Plan an answer A currency union works best with a small cluster of highly integrated and similar countries The reasons for keeping them out The PIIGS have not exercised the same budgetary controls During boom times they have run up huge fiscal deficits This has caused a loss of confidence among investors and speculators in international bond markets PIIGS have seen the interest rates they pay on their loans rise sharply Greece can no loner afford to borrow on the bond markets PIIGS are now forced to borrow form more fiscally prudent states & the IMF Why should they be allowed to join Met initial criteria Not totally their fault – German economy saves rather than spends – limited national trade multiplier effect European Commission should have exercised more oversight Given the right policies convergence could occur
24. Your evaluation could be along the lines of How far the problem caused by the PIIGS is likely to affect support for the Euro Whether exit from the zone would benefit the PIIGS or other members Whether given current conditions there currencies can converge These problems faced by the PIIGS have given rise to the concept of a 2 speed Euro area You need to be conversant with this idea
25. A two speed Euro area - Variation in the average growth rates achieved by countries inside the currency union Some suffering years of slower growth & high unemployment & ↓ living standards PIIGS likely to continue to experience difficulties in ↓ fiscal deficits & ↓ increase in government debt Why is this a problem for monetary union: ↓ standard of living in under-performing Euro Area countries High and rising unemployment Recession = ↓ tax revenues & huge ↑ budget deficits as a share of national income Sovereign debt crisis - emergency bail-outs from IMF & EU members Deflationary conditions attached to the emergency financial support
26. Brings about reductions in living standards for millions of people in these countries ↓ in public support for the Euro - threat to stability of the single currency system No discussion of recession is complete without a consideration of the shape that it may take The most outrageous example was probably given by the cartoonist in the mail who referred to “the dead cat bounce” I shall limit my discussion to the idea of the “double dip” The situation where an economy goes back into recession without achieving trend growth
27. AD ↑ from AD- to AD1 and rises to FE level at AD but falls back to AD1 With the aid of a diagram explain the possible causes of a double dip recession Price level 0 AS FE AD AD1 X AD- Z Real output
28. Possible causes of a double dip: Another external economic shock – collapse in major overseas export markets ↓ consumer confidence – so ↓ consumption – unemployment; ↑ debt; ↓ house prices ↓ business confidence – negative expectations - production cut-backs; ↓ investment ↑ exchange rate - ↓ international competitiveness – ↑ Euro against the US dollar Govt. policy - e.g. tightening of policy too soon - ↑ ROI or ↓ fiscal stimulus - Japan Inability to borrow – pressure from Bond markets forcing expenditure cut
29. At this stage of the proceedings it may be as well to remind ourselves of the stages of integration in an endeavour to decide whether monetary union is a step too far Knowledge of this area should assist with both analysis and evaluation It also contains a number of diagrams that are extremely relevant
30.
31.
32.
33.
34. Trade Creation ↑ in trade due to ↓/elimination of tariffs and quotas 0 Price W1 Domestic demand Domestic supply W Price + tariff Price minus tariff E B A C Quantity W1 – price before joining – Demand OA supply OB W price after joining – Demand ↑ to OC supply ↓ to OE Trade creation EB + AC Before I go any further make sure you can explain the important areas on the diagram
35.
36. Trade diversion ↑ in prices as producers in common market less efficient 0 Price Domestic demand Domestic supply E B A C Quantity EU price World price At world price demand OA and supply OB Price ↑ demand ↓ to OC supply ↑ to OE Explanation of the effects will complement the diagram and increase the marks
37.
38. Transfers of resources: Contributions may be spent on an area that does not directly benefit the contributor e.g. the UK and the common agricultural policy Net transfer of resources = static losses and gains Dynamic economies - attract inflows of capital and labour making them more dynamic Customs unions - not as efficient as world wide free trade Single market - negative impact on some sectors due to ↑ international competition Your job in a question would be to decide whether the benefits outweigh the disadvantages
39.
40. There are a number of areas that you can analyse and evaluate Free trade area: All members abolish tariffs with other members Trade between the members would flourish – benefits of EOS, MES, specialisation comparative advantage – trade creation diagram could be drawn All members individually free to set external tariff with non-members Countries could impose tariffs against external countries where trade diversion was taking place Possible danger of trade deflection but remedied by rules of origin No loss of monetary control Central bank free to set optimum ROI for the country Enables currency to float in accordance with market forces
41. Monetary union – a single market with a common currency Advantages Price transparency -make price comparison easier may lead to ↓ prices ↑ FDI due to ↑ currency stability & increased potential market size Potentially ↓ ROI, ↓ Govt interference, credible commitment to low inflation But : Loss of an independent monetary policy Inability to choose a different short term inflation/unemployment trade off Inability to react to country specific economic shocks 'Real' misalignment Asymmetric policy sensitivity
42. Evaluation PIIGS could have made it work using appropriate fiscal policies Given that its an un-optimal currency area – can it work? Deficit countries likely to struggle along with grudging help from surplus countries Would an independent monetary policy solve their problems Lets look at the PIIGS problems in more detail
43. The potential costs of a Single currency to the PIIGS Loss of an independent monetary policy Members pass control of monetary policy to the European Central Bank ECB would set ROI for area as whole rather than for any one country within the EMU This has several implications:
44.
45. Normally increased inflation would lead to a depreciation of the currency But in the Euro Area, a country with a relatively high rate of inflation cannot expect a depreciation of their exchange rate to restore lost competitiveness The PIIGS should have run a deflationary fiscal policy when AD was ↑ too rapidly They will have to achieve this in other ways such as a better supply-side of the economy or lower wages Part of their decline in competitiveness stems from these economies having a ‘fixed’ exchange rate against other members of the euro area. If the PIIGS had their own currency, they could let the value fall to a level that would make the country's tradable goods sectors competitive. Evaluate the view that PIIGS economic performance would improve by a currency devaluation and leaving the Euro Area (20) What issues could be considered and analysed in answer to this question Need to reduce wage costs to compete with Germany Rather than facing trade union anger over continuous wage deflation devaluation might be preferable
46. Price of $’s in Euros D & S of $’s Demand for $ Supply of $’s 1 D1 for $’s S1 of $’s 2 0 Equilibrium where $1 = €1 ↑ price of UK goods ->↓ US demand and ↓ supply of $’s – S-S1 PIIGS import more of the relatively cheaper US goods - demand for $’s ↑ - D-D1 ↓ supply of $’s and ↑ in demand ->↑ in the price of $s The overall effect of these changes is that the dollar has appreciated to $1 = €2. How inflation would depreciate the value of a currency
47.
48. Fig 12 - The J-Curve Following devaluation the account will get worse before it gets better Takes time for foreign buyers to realise PIIGS goods are cheaper and ↑ expenditure Long term contracts fix prices Short run - volume of exports remain the same and less will be spent on them More will be spent on imports until consumers find substitutes The short run demand for exports and imports will tend to be inelastic 0 BOP + BOP - Time J
49. 2. Other policy options by using supply side measures – outlined later Second part of question – leaving the Euro area Advantages Regain monetary independence Avoid years of grinding wage deflation to reduce unit labour costs Bring wage costs into line with workers productivity But: Euro took years to introduce PIIGS central banks would have to introduce new notes and coin FAST Bank runs as depositors shift money abroad to avoid losses – caps on withdrawal Cut off from foreign credit – banks would be reluctant to lend until currency stable Legal challenges – depositors with large losses might sue as in Argentina Foreign banks and pension funds would suffer effective default
50. Evaluation/judgement Will the depreciation set off inflationary pressures that PIIGS are unable or unwilling to contain or will there be a rising inflationary spiral given the power of trade unions Will the increased inflation wipe out the benefits of the initial depreciation Will the country be likely to increase welfare benefits as imported food prices increase Long run versus short run – how long will it take for the J curve effect to produce a surplus balance Are all the PIIGS able to benefit from increased international trade as opposed to the loss of intra community trade that they will suffer? Would costs of leaving Euro be greater than benefits
51.
52.
53. ↑ labour costs and output prices are likely to create cost push inflation SRAS shifted left leading to a higher level of prices and a lower level of output Possibly shifting the economy to a negative output gap - ↑unemployment & ↓GDP Cost push inflation Supply side pressure Price level Real output P 0 AD P1 A B SRAS SRAS1
54.
55.
56. Effect on incentives to actively search for work ↑ voluntary unemployment – make sure you know what this is ↑ frictional unemployment – don’t need to take first job to come along ↑ structural unemployment – no rush to retrain or move to where jobs are Social consequences of ↑ unemployment Estimated 40% of under 25’s 20% of working population ↑ relative poverty if no wage earner ↑ social unrest - loss of social cohesion damaging the fabric of society ↑ in unemployment-related crime ↑ stress related health problems and family breakdown ↑ social costs of rising level of debt – hits poor high rates Failure of labour market = ↑ negative externalities
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58. Large budget deficits incurred by the PIIGS have increased their economic problems Evaluate the view that governments should always balance their budgets Explanation of term budget balance and the stance a government might take: Neutral fiscal stance is where the government runs a balanced budget Expansionary fiscal policy government uses a budget deficit (G>T) to ↑ AD Contractionary/deflationary fiscal policy - budget surplus (G<T) to ↓AD Influencing the level of AD in the economy is referred to as demand management Governments do this to smooth out fluctuations in the economic cycle Automatic stabilisers – the cyclical deficit
59. Auto stabilisers should balance out over the duration of the cycle Spain - large welfare state, big public sector as % total GDP automatic stabilisers have ↓ impact of the recession on her GDP GDP Time Trend Actual Govt,Y from tax increasing Govt. expenditure on benefits falling = Cyclical surplus Govt Y from tax decreasing Govt. expenditure on benefits increasing Cyclical deficit 0
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62. Auto stabilisers take AD- to AD Fiscal stimulus required to get from AD to AD1 If government has a large structural deficit may not be able to afford the stimulus Govts. that ↑ the structural deficit in times of boom are risking problems when the economy contracts Price level Real output AS AD- AD FE AD1 0
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64. Evaluation points: Will a cyclical deficits/surpluses balance over the period of the cycle Risk that governments will ↑ handouts in good times leading to ↑ structural deficits Re- election may be more important than sound economic policy – govt. failure Possible damage to supply side of the economy of increasing benefits Opportunity costs of increasing PSNCR Problems with Bond markets and increasing national debt Will deficit benefit the supply side or just increase AD Short run effects versus long run effects Perhaps a final judgement that the deficit has helped prevent a worse depression but has left PIIGS with huge deficits to manage
65. Spain has had to introduce a period of fiscal austerity to ↓ their budget deficit Retirement age has risen to 67 from 65 ↓ government spending - wage cuts for civil servants and frozen welfare payments make it easier to lay off employees and reduce redundancy packages. Spain urgently needs to increase its LRAS – its trend growth rate This means labour market reforms to improve efficiency of factor markets Product market reforms – where there is a lack of competition & contestability Aims of supply-side policies ↑ supply and efficiency of labour ↑ skills of the labour force – investment in human capital ↑ mobility of labour – geographical & occupational Remove barriers that stop wages reaching equilibrium levels – reduce TU powe Encourage flexible working practices What are the policies 1. Labour market measures: Lower rates of income tax - create incentives to work
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67. ↓ benefit payments to make voluntary unemployment less affordable Welfare benefits can also be made more difficult to claim Tax relief on Y from renting out accommodation - ↑geographical mobility Welfare to work strategy to ↑ levels of employment and participation National Minimum Wage to ↑ incentives to supply labour rather than live off benefits 2. Education and training To increasing the productivity of labour Should ↑ LRAS & ↓. unit labour cost per unit of output ↑ international competitiveness. 3. Trade union reforms TU’s –↑ the wages of their members by restricting the supply of workers ↑ labour costs ↓ efficiency & market flexibility ↓ international competitiveness 4. Reform employment laws ↓ govt. regulation of labour market to lower non-wage costs of employing workers Encourage short term contracts and part time labour Encourage profit related pay Encourage employee share ownership
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69. 6. Measures to encourage entrepreneurship and capital spending: Loan guarantees for new start-ups Reducing rates of corporation tax for small businesses Allowing tax relief on profits used for investment purposes Regional policy assistance in depressed areas 7. Policies to encourage enterprise ↓ taxation & govt. spending ↓ corporation tax to increase investment Incentives to encourage FDI Encouraging business start ups
70. Consequences of policies Boost long term growth ↑ prosperity in long run Helps to achieve all macro-economic objectives simultaneously ↑ employment ↓ cost push inflation by increasing efficiency ↑ international competitiveness We can show the effects of these policies diagrammatically but remember they take time to have an effect
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72. An alternative diagram ↑ AD from AD to AD1 ↑ inflation PL to PL1 A supply side increase allows ↑ real output with lower prices PL- Price level Real output AS FE AD- AD AD1 AS1 PL PL1 PL- Fe1 0
73. In a rapidly-changing world there needs to be a high level of flexibility as patterns of demand change bringing about changes in the pattern of employment Analyse the determinants of a flexible labour market – 6 marks Labour market flexibility ↓ natural rate as labour moves from declining industries to growing industries Labour markets need to - adapt to change, respond to economic signals created by wage differentials Flexible labour market characterised by: Mobility of labour - adaptable, capable of learning new skill Training and retraining opportunities must be available Must be possible for employers to hire people with the skills they need Labour force must have good basic educational foundations Employers must be able to get rid of workers Employment protection laws but make employers less likely to hire in the first place Short term contracts - workers able and willing to adapt to employers requirements.
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76. Extract 4 – Pascal Lamy emphasises the importance of international trade Free Trade and Protection Free trade – absence of protection - based on Comparative Advantage Worlds’ resources used more efficiently when countries specialise in producing those goods and services in which they have a comparative advantage Comparative advantage – opportunity cost of producing the good in one country is less than elsewhere Benefits obtained by importing from countries where the opportunity cost is lower Concentrating on exporting something in which a country has a comparative advantage
77. Worldwide specialisation based on comparative advantage = efficient resource use Competition/economies of scale should lead to dynamic efficiencies Theory states that countries should specialise in the production of those goods where they have the greatest comparative advantage, or least comparative disadvantage Assume 2 areas Europe and Australia, both producing food and clothing. Australia Europe Product units per hour units per hour food 6 2 clothing 3 1.5 Australia produces more of both goods in less time - has an absolute advantage Benefits of Trade Australia Europe Product units per hour units per hour Food 6 3 Clothing 4.5 1.5
78. Case for trade - all countries taken together will gain in terms of increased production, economic efficiency, and welfare No guarantee gains equally distributed some countries may feel that it is their interest to restrict trade Arguments for protection The infant industry argument Cushion home employment Prevent dumping - anti dumping measure may be a technique of protection Improve Balance of payments Protect employment levels Avoid "unfair" competition – NIC’s exploit labour by paying low wages Arguments against protection . Retaliation - reduces world trade to the detriment of all Props up inefficient producers’ - do not face efficient competition Welfare loss to consumers
79. World price before tariff is OP domestic demand OC domestic supply OB Tariff ↑ price increases to P+T domestic demand ↓ to OA domestic output ↑ to OE Imports ↓ from BC to EA Total consumer welfare has fallen by P, P+T,F,G Domestic suppliers gain P,P+T,H,J at the expense of consumers HFKL represents the revenue from the tariff – the amount imported times the price Net loss - triangles JHL and FGK - tariff has reduced welfare as a whole Fig 5 Welfare loss Price Quantity Domestic demand Domestic supply World price 0 P P+T Tariff price C B E A J H L F K G
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82. International Organisations The World Trade Organisation (WTO) WTO - global international organisation dealing with the rules of trade between nations WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments Aim is to ↓ tariffs and other types of protection through “rounds” where countries try to agree to reduce tariff levels To help producers of goods/services, exporters/importers conduct their business Multi-lateral agreements using the principle of “most favoured nation status” If a country agrees a tariff reduction with one country it has to accept the reduction with all others This can be contrasted with bi-lateral agreements where the country only agrees trading terms with another country and does not extend it to others
90. The problem of mis-alignment Straight line shows desired economic convergence The trade cycles are shown as horizontally opposed UK in recession while Euroland in boom - different monetary policies are appropriate 0 GDP Euroland UK Time
91. Evaluation/judgement: Costs greater where: there is a lack of economic convergence Countries suffer differently from asymmetric shocks There is a lack of flexibility & mobility in factor markets Concern that the Euro area is not an optimal currency area
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94. 6. Comment on the extent to which a reduction in global trade barriers in manufacturing and agricultural goods can help a developing country (10) Introduction Explanation of global trade barriers Reasons for global barriers Both developed and undeveloped countries use barriers Benefits of free international trade & their limitations Terms of trade Analysis Diagram of tariff barriers Numerical example of benefits of free trade Outline the problems that the country might incur - ↑ unemployment ↑ BoP deficit Evaluation Are advantages > costs May depend on individual circumstances of the country