## Macroeconomics Discussion Questions for Exam #4

LESSON 10 Macroeconomics Discussion Questions for Exam #4 Chapter 22 Refer to Exhibit 1 below U.S. Production of Organic Tofu (in millions of tons...
LESSON 10

Macroeconomics Discussion Questions for Exam #4

Chapter 22

Refer to Exhibit 1 below

U.S. Production of Organic Tofu (in millions of tons) 60 40 20 0

1.

U.S. Production of Weapons Grade Plutonium (in ounces) 0 30 60 90

French Production of Organic Tofu (in millions of tons) 90 60 30 0

French Production of Weapons Grade Plutonium (in ounces) 0 10 20 30

2.

In Exhibit 1, the opportunity cost of one unit of Weapons Grade Plutonium in France is ____________ and the opportunity cost of one unit of Organic Tofu in France is _____________.

3.

In Exhibit 1, the opportunity cost of one unit of Weapons Grade Plutonium in the United States is ___________ and the opportunity cost of one unit of Organic Tofu in the United States is ____________.

4.

When trading, France should specialize in ________________ and the United States should specialize in __________________.

Macroeconomics

Due at the start of test 4

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Macroeconomics Discussion Questions for Exam #4 5. Draw and describe the effects of a tariff.

Chapter 23 6.

Define balance of payments and list the components of the balance of payments

7.

Define Exchange Rate, Appreciation and Depreciation

Macroeconomics

Due at the start of test 4

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Macroeconomics Discussion Questions for Exam #4

8.

A German computer is priced at 1,000 Euros (EUR). If the exchange rate between the Euro and the Japanese Yen (JPY) is 0.0093 EUR = 1 JPY, approximately how many Yen will a Japanese buyer pay for the computer?

9.

The chart below shows a single exchange rate change from the Mexican point of view and the American point of view. It is roughly equivalent to the change in the actual exchange rate from 1995 to 2009. Fill in the chart below and note at the bottom which country would have experienced, all other things being equal, an increase in its GDP due to an increase in NX (Exports – Imports):

View from Mexico

View from America

The Exchange Rate was 1MXN = 0.2USD

The Exchange Rate was 1USD = 5 MXN

Now the Exchange Rate is 1MXN = 0.1USD The Value of Mexican Mexican the Peso Imports from Exports to the against the the U.S. U.S. Dollar

Now the Exchange Rate is 1USD = 10 MXN The Value of the Dollar U.S. Exports to U.S. Imports against the Mexico from Mexico Peso

Macroeconomics

Due at the start of test 4

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10.

11.

Macroeconomics Discussion Questions for Exam #4

The chart below shows a single exchange rate change from the Japanese point of view and the American point of view. It is roughly equivalent to the change in the actual exchange rate from 2007 to 2011. Fill in the chart below and note at the bottom which country would have experienced, all other things being equal, an increase in its GDP due to an increase in NX (Exports – Imports):

View from Japan

View from America

The Exchange Rate was 1JPY = 0.0083USD

The Exchange Rate was 1USD = 120JPY

Now the Exchange Rate is 1JPY = 0.0125USD Japanese The Value of Japanese Imports from the Yen against Exports to the the U.S. the Dollar U.S.

Now the Exchange Rate is 1USD = 80JPY The Value of the Dollar against the Yen

U.S. Exports to Japan

U.S. Imports from Japan

An increase in the Real GDP per capita of Japan, South Korea, India and Colombia will have what effect on U.S. Exports and what effect on the U.S. GDP?

Macroeconomics

Due at the start of test 4

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LESSON 11

Macroeconomics Discussion Questions for Exam #4

Chapter 17 12.

Why might per capita real economic growth be a more useful measurement than absolute real economic growth?

13.

How do calculate per capita real GDP?

14.

Assume Japan has Real GDP of \$5 trillion and a population of 130 million in year 1 and a Real GDP of \$5.5 trillion and a population of 133 million in year 2. What was the per capita GDP in each year and did they see an increase in per capita real economic growth?

15.

Explain how each of the following relates to economic growth: (a) technological advance; (b) labor productivity; (c) natural resources; (d) education; and (e) special interest groups.

Macroeconomics

Due at the start of test 4

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Chapter 24

Macroeconomics Discussion Questions for Exam #4

16.

What is globalization and what are seven evidences of Globalization?

17.

Draw the impact on the aggregate demand curve due to (1) an increase in a trading partner’s real GDP and (2) and appreciation in the dollar.

Macroeconomics

Due at the start of test 4

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Macroeconomics Discussion Questions for Exam #4 18.

Draw the impact on the aggregate supply curve due to (1) an increase in foreign input prices and (2) an appreciation of the dollar.

Nanocivics 19. From the recommended reading on the class syllabus, (book by Sims, Nanocivics) make a list of several items related to economic freedom that are necessary for economic growth.

Macroeconomics

Due at the start of test 4

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LESSON 12

Macroeconomics Discussion Questions for Exam #4

Chapter 18

20.

State three factors that contributed to the Financial Crisis of 2007-2009

Chapter 19 21.

Not all economists agree on what constitutes the optimal size and scope of government. Therefore, they won’t all agree as to the preferred fiscal policy measures to stimulate the economy. What two economists are representative of the different sides of this debate and which side do you lean toward? Why?

Macroeconomics

Due at the start of test 4

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