Exam 15: Dsge Models: the Frontier of Business Cycle Research

In the real business cycle models, business cycles are caused by:

Which of the following features are frequently included in modern DSGE models? i. Nominal rigidities ii. Complete markets iii. Adjustment costs to capital

In a paper by Minneapolis Fed bank president Narayana Kocherlakota, he argues that research in macroeconomics is hampered by:

Which of the following economists and Nobel Prize winners did NOT contribute to the DSGE literature?

The labor supply is represented by .

Using the Cobb-Douglas production function , the marginal product of labor, or the real Wage, is:

In the business cycle literature, a better court system could be considered a negative TFP shock.

Which of the following is true when a financial friction is included in the Smets-Wouters DSGE model? i. Consumption rises ii. Investment rises iii. Inflation falls

When taxes are included in the stylized DSGE model, with Cobb-Douglas production, labor demand is given by:

With a nominal price rigidity:

In the Solow model, ________ is assumed to be constant.

In 2003, Ireland reduced its corporate tax rate from 16 percent to 12.5 percent. In labor markets this would cause an increase in labor demand, which would push real wages up.

In the Smets-Wouters DSGE model, the financial friction is introduced by a:

Using the Cobb-Douglas production function , the marginal product of labor, or the real Wage, is:

With a financial friction shock, the Smets-Wouters DSGE model shows that the largest impact is on:

RBC stands for:

Impulse response functions can be thought of as:

When consumption falls, ________ also tend(s) to fall.

In the abbreviation DGSE, the "S" stands for ________ and refers to ________ that impact the macroeconomy.

With sticky nominal wages, a monetary expansion causes: