![Macroeconomics](https://www.bartleby.com/isbn_cover_images/9781319105990/9781319105990_smallCoverImage.jpg)
Macroeconomics
10th Edition
ISBN: 9781319105990
Author: Mankiw, N. Gregory.
Publisher: Worth Publishers,
expand_more
expand_more
format_list_bulleted
Question
Chapter 14, Problem 1MPA
(a)
To determine
The assumptions need to yield the model of classical large open economy.
(b)
To determine
The assumptions need to yield the Keynesian-cross model.
(c)
To determine
The assumptions need to yield the IS-LM model for large open economy.
Expert Solution & Answer
![Check Mark](/static/check-mark.png)
Want to see the full answer?
Check out a sample textbook solution![Blurred answer](/static/blurred-answer.jpg)
Students have asked these similar questions
Indicators dashboard assignment 2022
Macroeconomics is about more than just the models discussed in the textbook. JM Keynes wrote
about the master economist:
..."He must understand symbols and speak in words. He must study the present in the light of the past
for the purposes of the future".
As part of your training as master economists, you need to keep an eye on the news and
macroeconomic indicators that economists are interested in.
For 20% of your module mark you need to present the indicators that you followed throughout the
semester in a indicators dashboard. This is due on 27 May 2022.
Instructions:
•
You can compile your dashboard in any way that you like, but for assessment you need to
upload a pdf report on eFundi.
•
This report needs to present the indicators data in tables and graphs, and you need to briefly
interpret them:
o Use the macroeconomic policy objectives as a starting point: economic growth and
increasing employment, stable and low inflation, a sustainable…
Which assumption of HO cannot be used in Classical model as it eliminates the basis for international trade
Discuss how the theoretical CAPM model is made operational when going from the theory to the empirical practice.
Knowledge Booster
Similar questions
- 1. What are the assumptions of the Fisher’s Intertemporal Choice Model?arrow_forwardIn the simplest (or introductory) form of the Keynesian model, which of the following decisions can we analyse? A. Interest rate fluctuations. B. Saving of households. C. Investment by government. D. Foreign investment by firms. E. Wage levels in firms.arrow_forward2. Let's create a simple, two-period neoclassical model In this question, in period t you only use labor to make period t output, and then you decide how much of that output to convert into capital that can be used later to help make period t+1 output. That means the "representative agent" has to decide how much of period t output to consume rather than save, but there's no such choice in period t+1. After all, t+1 is the end of time. Output is made in this very simple, constant returns to scale manner, so in each period double the input creates double the output: Y₁ = N₁ Y zK = You get log utility from consumption in the first period, but square root in the second period Of course, you don't like work, so extra hours of work hurt your utility: U = ln(Ct) — mNt + 2(Ct+1)¹/² In this simple economy with no externalities and perfect property rights, Adam Smith's Invisible Hand Theorem will hold in its most optimistic form: A benevo- lent social planner and a decentralized private market…arrow_forward
- 1) Identify key assumption underlying Keynesian and Classical approaches to macroeconomic analysis. In your answer indentify how Keynesian and CLassical economist differ regarding understandign about the business cycle and how the economy should best be managed ?arrow_forwardWhich one of the following macro-economic variable should be excluded in a Keynesian model of a closed economy without government Select one: a. Investment b. Induced consumption c. Government spending d. Savingsarrow_forwardPiketty (2014) argues that a fall in the growth rate of the economy is likely to lead to an increase in the difference between the real interest rate and the growth rate. This problem asks you to investigate this issue in the context of the Ramsey Cass Koopmans model. Specifically, consider a Ramsey Cass Koopmans economy that is on its balanced growth path, and suppose there is a permanent fall in g. (a) How, if at all, does this affect the k = 0 curve? (b) How, if at all, does this affect the c = 0 curve? (c) At the time of the change, does c rise, fall, or stay the same, or is it not possible to tell? (d) At the time of the change, does r - g rise, fall, or stay the same, or is it not possible to tell?arrow_forward
- Hi, Please help with this Macroeconomics question. Thanks!arrow_forwardBriefly explain how one or more of the microeconomic components, namely consumption,investment, supply and demand for money influence macroeconomic outcomes and formulations of the following macroeconomic theories:a. Solow Growth Model b. The Mundell-Fleming model c. Neoclassical Model of Investment Use mathematical equations and graphs where necessary.arrow_forwardQue a) To what extent has the time-inconsistency problem influenced the formation and practical operation of macroeconomic policy?arrow_forward
- What the diffrrent and similaries of heckscher ohlin model and ricardian model and their assumptionsarrow_forwardA) Identify - and justify with macroeconomic arguments the long-term adjustments (i.e., the possible displacements of the 3 curves identified on the graph) that can be expected, all things being equal. b) Identify - and justify with macroeconomic arguments what are the implications for: i. the inflation rate, ii. the real growth rate, iii.the unemployment rate, and iv. the output gap (i.e. the difference between realized GDP and full capacity GDP)arrow_forwardLinear stages theory, Structural-change model (Lewis two-sector model), International dependence/dominance model, Neoclassical model How do the contemporary models differ from the previous models? Coordination failures ComplementarityWhy do these models emphasize multiple equilibria and what does it mean?What problems may prevent economy from moving from a bad equilibrium to a stable one?Need to understand that graphWhat are the big push and O-ring theories (important to have a broad or general understanding ofthe two theories?)arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSONEngineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
- Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
![Text book image](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Text book image](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
![Text book image](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
![Text book image](https://www.bartleby.com/isbn_cover_images/9781305585126/9781305585126_smallCoverImage.gif)
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
![Text book image](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
![Text book image](https://www.bartleby.com/isbn_cover_images/9781259290619/9781259290619_smallCoverImage.gif)
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education