Parkes' Economics for Business II Assignments, Spring 2013
[Andrew's SILC Home
Page, Shanghai, China] - [Drew's Home Page, United States]
Tentative Schedule and Course Assignments:
May 28, 2013 Chapter 34: Open Economy Macroeconomics
- Chapter 32: Inflation, Disinflation, and Deflation continued
- Moderate Inflation and Disinflation - Definitions and Causes
- The Great Disinflation of the 1980s
- DEFLATION - Today's Issue and the Liquidity Trap (Zero Bound)
- Effects of Unexpected Deflation
- Effects if Expected Deflation
- Examples: Japan, Europe today maybe?
Chapter 34: Open Economy Macroeconomics
The Role of Exchange Rates
Understanding Exchange Rates
The Equilibrium Exchange Rate
Shifts in Demand
Inflation and Real Exchange Rates
Purchasing Power Parity
- Big Mac Index
- Dollar and the Deficit
Exchange Rate Policies
Exchange Rate Intervention and Foreign Exchange Reserves
Krugman's Chapter 34 PPT - Second Edition
May 30, 2013 Continue Chapter 34: Open Economy Macroeconomics
- Finish Chapter 34: Open Economy Macroeconomics
- Exchange Rate Regime Dilemma: To Fix or Not To Fix
- Examples of fixed rates: Bretton Woods, Euro, Yuan
- Macroeconomic Policies and Exchange Rates
- Krugman's Chapter 34 PPT - Second Edition
REVIEW
Final Exam: Chapters 22 - 26, 32 & 34, on Friday, June 7, 2013
From 8:15 to 10:15, Rooms: 1107, 1109, and 1111
Do not forget the Solow Growth Model and the ISLM Model!!!
PAST ASSIGNMENTS:
May 21, 2013 The ISLM and AD/SRAS/LRAS continued and Chapter 32: Inflation, Disinflation, and Deflation
- ISLM - How Interest Rates may be determined with Aggregate Demand
- Finish Problem Set 10 - ISLM determination of interest rates
- Aggregate Demand I and II - Chapters 10 & 11: ISLM to Aggregate Demand
- Determination of interest rates
- Affect upon the economic goals
- Monetary Policy in the ISLM framework
- Fiscal Policy in the ISLM framework
- Problem Set 10 - ISLM determination of interest rates
- Chapter 32: Inflation, Disinflation, and Deflation
May 23, 2013 Continue Chapter 32: Inflation, Disinflation, and Deflation
- Chapter 32: Inflation, Disinflation, and Deflation
- Hyperinflation - One Cause: seignoirage
- The Logic of Hyperinflation
- Brazil
- Yugoslavia
- Zimbabwe
- Effects of Inflation
- Winners and Losers from Unexpected Inflation
- Real versus nominal interest rate - The Fisher Effect
- Costs of Inflation
- Krugman's Chapter 32 PPT - Second Edition
Week 8
May 14, 2013 Chapter 26: Loanable Funds Market and Chapters 27-31: AD/SRAS/LRAS revisited
- Chapter 26: Saving and Investment
- Loanable Funds Markets - 4 Graphs in Class Work
- Aggregate Demand I and II (pdf below) - ISLM to Aggregate Demand
- Determination of interest rates
- Affect upon the economic goals
- Monetary Policy in the ISLM framework
- Fiscal Policy in the ISLM framework
Problem Set 8 - Keynesian Cross
May 16, 2013 Review the ISLM and AD/SRAS/LRAS
- ISLM - How Interest Rates may be determined with Aggregate Demand
- Aggregate Demand I and II: ISLM to Aggregate Demand
- Determination of interest rates
- Affect upon the economic goals
- Monetary Policy in the ISLM framework
- Fiscal Policy in the ISLM framework
Problem Set 9 - ISLM determination of interest rates
Problem Set 9, 10 & 10a - ISLM determination of interest rates
Aggregate Demand I - ISLM Part I
Aggregate Demand II - ISLM Part II
Week 7
May 7, 2013 Chapter 25: Long-Run Economic Growth/Solow Growth Model
May 9, 2013 Chapter 25: Long-Run Economic Growth/Solow Growth Model - Continued
Krugman's Chapter 26 PPT - 2nd Edition
Week 6
April 28, 2013 Review: Chapter 22-23: The Big Picture
May 2, 2013 Chapter 24: Tracking the Economy
Chapter 24: Tracking the Economy
- What is a price index and how do we calculate them? CPI, GDP deflator
- NIPA - National Income and Product Accounts
- SEE PPT - Personal Income, National Income, GDP versus GNP - how are they related?
- Calculate Growth Rates
- Calculate CPI and GDP delfator
- Calculate PCE and GDP deflator growth rates
- Real wages - with and without inflation and wage raises
- Homework for next class - 3 goals, indicators and values for the U.S. AND China
- Krugman & Wells Chapter 24 PPT - Second Edition
Week 5
April 23, 2013 Chapter 18: Public Goods and Common Resources
April 25, 2013 Chapter 20: Factor Markets and the Distribution of Income
- Private Goods
- Factors of Production
- Marginal Productivity and Factor Demand
- Value of the Marginal Product
- Shifts of the Factor Demand Curve
- Income Distribution with MP theory
- The Markets for Land and Capital
- The Supply of Labor
- Krugman's Chapter 20 PPT - Factor Markets
Midterm Exam will be on April 26, 2013: From 13:30 to 15:00;
Class 2001: Room 1107;
Class2002: Room 1109
Class2003: Room 1111
Chapters 8, 14 - 18 and 20: As Covered in class.
April 16, 2013 Chapter 8: International Trade continued
- Chapter 8: International Trade
- Comparative Advantage and International Trade
- Ricardian Model of International Trade
- Autarky
- Gains from Trade
- Sources of Comparative Advantage
- Differences in Climate
- Differences in Resources - Factor Endowments
- Differences in Technology
- Increasing Returns and International Trade
- International Trade and Factor Markets
- The Effects of Trade Protection
- The Effects of a Tariff - consumer and producer surplus, tariff revenue and dead weight losses
- The Effects of a Quota - consumer and producer surplus, tariff revenue and dead weight losses
- The Political Economy of Trade Protection - Arguments for and Against
- Day 7 PPT - U.S. - P.R.C. Trade Statistics (Shown in Class)
- Krugman's Chapter 8 PPT - International Trade
April 18, 2013 Chapter 17: Externalities
- Chapter 17 - Externalities
- The Economics of Pollution
- Costs and Benefits of Pollution
- Private Solutions to Externalities
- Coase Theorem
- Internalizing the Externality
- Policies toward Pollution
- Environmental Standards
- Emissions Taxes
- Tradable Emissions Permits
- Production, Consumption, and Externalities
- Pigouvian Subsidy and Pigouvian Tax
- Mankiw's Externalities PPT
- Krugman's Chapter 17 PPT - Externalities
- Review of the 4 types of market structure:
- Perfect Competition
- Monopolistic Competition
- Oligopoly
- Monopoly
Week 3
April 9, 2013 Chapter 15: Oligopoly continued
- Chapter 15: Oligopoly continued
- Imperfect Competition and the Prevalence of Oligopoly
- Duopoly - Quiz 5
- Collusion and Competition
- Noncooperative Behavior
- Price or Quantity Competition?!
- Oligopoly in Practice
- Anti-trust Policies
- Product Differentiation
- Price Leadership
- Krugman's Chapter 15 PPT - Oligopoly
April 11, 2013 Chapter 16 PPT - Monopolistic Competition and Chapter 8: International Trade
- Read Chapter 16: Monopolistic Competition
- Definition
- Large number of producers
- Differentiated Products
- Free Entry and Exit
- Product Differentiation
- Differentiation by Style or Type
- Differentiation by Location
- Differentiation by Quality
- Monopolistic Competition in the Short-Run
- Inefficient or Efficient?
- Advertising
- Brand Names
- Krugman's Chapter 16 PPT - Monopolistic Competition
- Chapter 8: International Trade
- Supply, Demand, and International Trade
- Import Demand
- Export Supply
- Consumer Surplus and Producer Surplus
- The Effects Imports
- The Effects Exports
- The World Price
- 3 panel diagrams for the world price
- Krugman's Chapter 8 PPT - International Trade
Week 2
April 2, 2013 Chapter 14 continued
- REVEIW: Quiz #3 - Monopoly (and PC) making a profit, loss, and shutdown
- Chapter 14 - continued
- Dealing with a Natural Monopoly - how to properly price and regulate a Natural Monopoly
- Elasticity of Demand and Total Revenue
- Price Discrimination
- Elasticity
- Perfect Price Discrimination
- How discrimination is possible, differing geographic areas, etc.
- Chapter 15 Oligopoly
- Game Theory
- The Prisoners' Dilemma
- Payoff Matrix, Dominant Strategy, and Noncooperative Equilibrium
- Nash Equilibrium - John Nash of "It's a Beautiful Mind" movie
- Repeated Games
- Strategic Behavior
- Tit for Tat and Tacit Collusion
- Kinked Demand Curve
- Krugman's Chapter 15 PPT - Oligopoly
April 4, 2013 Qing Ming Jie Holiday
- Enjoy the Qing Ming Jie Holiday
Week 1
March 26, 2013 Chapter 13: Perfect Competition and the Supply Curve
- Review of Perfect Competition
- 4 Characteristics of Perfect Competition
- 1. Price Takers, numerous buyers and sellers, no large market share
- 2. Identical or homogeneous product, standardized product
- 3. No restrictions on entry and exit
- 4. Perfect information - everyone has the same info
- Marginal Revenue, Price, Marginal Cost, Average Variable, Fixed and Total Cost
- Goal? Profit maximization, MR = MC
- 3 conditions to produce
Homework #1: Short-run and Long-run in an Increasing Cost Industry
Krugman's Chapter 13 PPT - Second Edition
March 28, 2013 Chapter 14: Monopoly
- 4 Types of Market Structure
- Chapter 14: The Monopoly Market Structure
- A definition of Monopoly - one seller with no close substitutes
- The Monopolist IS the Market! - shown graphically
- Why Monopolies exist:
- Control of a Resource
- Economies of Scale
- Technical Superiority
- Government-Created Barriers
Profit Maximizing Monopolist charges a higher price and produces less than a Perfect Competitor (Fig. 14-6)
Welfare Effects of a Monopoly
Dealing with a Natural Monopoly
Krugman & Wells Chapter 14 PPT - Second Edition
[Andrew's SILC Home Page, Shanghai, China] - [Drew's Home Page, United States]
email: andrew at andrewparkes.com
Last Update: May 27, 2013
By Andrew L. H. Parkes, Ph. D.