ECON341, 301 and 303

[toyboy88]

Originally posted by incognito



Based on what Tracey showed in class, wouldn't the interest rate in Canada be equal to the world interest rate since you end up at where all 3 curves intersect?

I'm a bit unsure as well. Can anyone help me out?

Correct.

i is back at world interest rate, and Y has increased.

[mina_03]

Originally posted by toyboy88


Correct.

i is back at world interest rate, and Y has increased.

I thought that the canadian interest would be lower than world interest because I think he showed us how to do this question in class. Well in my notes anyways he did something that looks exatcly the same. I have it dated on Feb 27th.

I know what you guys mean by it reverting back to the original.
but the IS and LM also intersect before all three curves connect.

[incognito]

I remember him doing this in class but isn't the assignment a different case though? The question on the assignment is asking what would happen if you enact an expansionary fiscal policy and an expansionary monetary policy simultaneously. After shifting the IS curve right and LM curve right, you end up where all three curves intersect with a higher output.

Agree/Disagree?

[flipstah]

Originally posted by incognito
I remember him doing this in class but isn't the assignment a different case though? The question on the assignment is asking what would happen if you enact an expansionary fiscal policy and an expansionary monetary policy simultaneously. After shifting the IS curve right and LM curve right, you end up where all three curves intersect with a higher output.

Agree/Disagree?

Yup, I agree with the fact that in the end, the new curves intersect back at the world interest rate but a higher output.

However, I may have done the policies backwards and I think I see the fault in my error.

1b implies that the fiscal policy has already been implemented, shifting IS first.

Then, LM needs to shift next, thanks to the monetary policy.

[mina_03]

lol. I see what u guys mean. I dont know if its just the cold that is making me retarded.

Thanks for your help.

[flipstah]

Hey everyone, I missed the first 4 minutes of class. I was wondering if the third assignment is still due on the 30th?

[incognito]

Yep...still on the 30th.

[incognito]

Anyone working on the assignment 3 right now? For Question 1b, only one indifference curve is required correct? Even though it does ask for 'indifference curves'.....

[toyboy88]

^^^
well for 1b - i'm drawing in 3 possible indifference curves as an example and explaining how the indifference curve is always a perfect complement at any budget constraint.

since 1c also asks for the indifference curve at the optimal point.


??

[flipstah]

Who's ready to rock tomorrow!?

[toyboy88]

Hopefully a nice end to ECON 303!

[flipstah]

Originally posted by toyboy88
Hopefully a nice end to ECON 303!

Was anybody else blindsided by the tax credit question? I THINK I got it but whatever. The rest were pretty easy.

[incognito]

Yeah...that tax credit question was....interesting.

I know that the exam is over and all....but what did you guys get for the last question? I said borrower.....

[flipstah]

Originally posted by incognito
Yeah...that tax credit question was....interesting.

I know that the exam is over and all....but what did you guys get for the last question? I said borrower.....

Same. Borrower with negative savings.