Chat with AIExam 6: An Introduction to Macroeconomics
Which are the richest and poorest countries listed in Global Perspective 4.1 (page 92).How does Canada compare to these two countries?
(45) 
VerifiedIn 2011,the United States was the richest country while Zimbabwe was the poorest as measured by adjusted GDP per capita.Canada was the second richest country.
Why do economists measure growth in an economy using real GDP rather than nominal GDP?
(42) VerifiedNominal GDP measures the final dollar value of all goods and services produced in an economy in a year.This measurement is made using current dollars.Growth in nominal GDP can occur for three reasons:(1)more goods and services are produced, (2)goods and services have higher prices,and (3)there is an increase in both goods and services produced and their associated prices.Real GDP is measured in constant dollars,so an increase in real GDP simply measures an increase in the production of goods and services.
What are inventories and what role do they play in an economy with sticky prices?
(37) VerifiedInventories are goods that have been produced but remain unsold.In a world of sticky prices,unexpected increases in inventories indicate an unexpected increase in demand.Similarly,unexpected decreases in inventories indicate an unexpected decrease in demand.
What will happen to prices and output levels if there is an unexpected demand increase and prices are fully flexible?
(37) Suppose that we are in a condition of "stuck" prices so that the price of wooden chairs will not go above or below $125/unit.Further suppose that chair factories have been built on a business plan designed to deliver 200/month.How many chairs will be sold in a market in which demand (which includes a modest amount of inventory)is characterized by: (a)P = 425 - 1.5Q, (b)P = 530 - 1.5Q,and (c)P = 400 - 0.5Q,where P is in $/chair and Q is in chairs/month? In each case,what happens to planned inventory.
(43) What will happen to prices and output levels if there is an unexpected decrease in demand and prices are fully flexible?
(31) In order to compare GDP across nations,economists typically make 3 adjustments.What are these adjustments and why are they carried out?
(32) If prices are "stuck" and there is an unexpected demand increase,describe what happens in the economy.
(33) In this list,identify those investments which are financial (F)and those that are economic (E): Canada Savings Bonds,stock in Potash Corporation of Saskatchewan,an old house you plan on fixing and reselling,new machinery for a factory you own,land that you plan to develop,an old window factory,your university education.
(39) Why do economists use the term "sticky" prices rather than "stuck" prices?
(32) What is the Great Recession? Describe its causes and also its impact on the Canadian Economy.
(29) Suppose that we are in a condition of fully flexible prices,but production of nails will not go above 6,000 kg/week.What price will nails sell for if market demand is characterized by: (a)P = 5 - 0.5Q, (b)P = 6 - 0.5Q,and (c)P = 4 - 0.5Q,where P is in $/kg and Q is in thousands of kg/week?
(38) 
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