Important Topics (Not a complete list...)
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Chapters 1- 6
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1. Indexes (Paasche, Laspeyres,
Fisher), Real vs Nominal GDP.
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2. Growth Rate; for a period of
time, for two consequtive years, prediction, e.g. Yt=Y0(1+g)^t, etc.
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3. Use the properties of growth
rates, e.g. If z=x*y, then Gz=Gx+Gy, etc.
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4. Returns to scale of production
function - show what happens to the output when you double the inputs.
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5. Be able to transform any
production function in per capita form, e.g. Y=K^1/3*L^2/3 ==>
y=k^1/3 .
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6. Sollow Model:
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a.
Explain what each item in the model means, explain the main advantages
and disadventagies of the model.
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b. Draw
the Solow diagram and the time diagram .
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c. Given a change in fundamentals, explain what happens with the
economy immediately and in the long run.
Use text and graphs.
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d. Explain and apply the principle of transition dynamics.
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7. Romer Model:
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a.
Explain what each item in the model means, explain the main advantages
and disadventagies of the model. |
b.
Compare Solow and Romer model.
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c.
Given a change in fundamentals, explain what happens with the economy
or some of its elements.
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d. What
affects the growth in the model?
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e. Role
if any for the principle of transition dynamics.
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f.
Combined Solow-Romer model: basic understanding, main advantages. |
8. Growth acconting: given a
production function, create the growth equation and compute the growth.
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Formula Sheet for Exam 1
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Chapters 7- 11
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| 7. Unemployment:
definition, types. Human capital, present discounted value. |
8. Inflation, quantity
theory of money, Fisher equation.
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9. Short-run output,
Phillips curve, Okun's Law.
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10. IS curve, permanent income
hypothesis, life cycle model.
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11. Nominal and real interest rate,
IS-MP, Phillips curve.
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| Formula Sheet for Exam 2 |
Chapters 12- 15
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12. Rules and discretion, simple
monetary rule, AS-AD.
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13. Government, spending, budget
constraints, intertemporal budget constraint, crowding out.
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14. International trade, principle
of comparative advantage, trade balance.
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15. Nominal and real exchange rates,
law of one price, exchange regime.
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Formula Sheet for
Final
Exam
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