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What would you expect a vegetation to look like?

The Fisher Effect or Fisher Relationship predicts that 1% increase in inflation causes a/an ____% change in the nominal interest rate and a _____% change in the real interest rate. 

When the average person in Alaska receives his check from the state’s oil fund, the average Alaskan spends between 40% and 60% of that check on consumer nondurables within 30 days. 

In a two-period world, the government has committed to never using seignorage to repay the debt, so only taxes and government purchases matter for the intertemporal government budget constraint. In this country, the constitution says that taxes = T = 150 each period, and current government purchases are 250 now. The interest rate (r) is 40% (as usual, think of a big interest rate like this as a generational interest rate if you find that helpful). What will government purchases be in the second period?  Answer with a number: If you think the answer is 400, just write 400 as usual. 

In the traditional Keynesian model, what happens to GDP (Y) and consumption (C) when government purchases (G) rise? 

In Friedmania, a new nation that wants to follow the Friedman Rule, the real interest rate is 5% per year, real GDP grows at 1% per year, and the capital share of GDP is 30%. If the country wants to follow the Friedman rule, what annual inflation rate should the central bank aim for on average?  Answer in percent, but leave out the percentage sign. So if you think the inflation rate should be 15% per year, write 15, not 0.15. If you think the answer should be -30% per year, write -30, not -0.3. 

Kling emphasizes that “Specialization and Trade” are the province of only a small minority of participants in the economy. 

In a typical two-period endowment economy, a rise in government purchases (G) will _________ the interest rate (r) and __________ real output (Y).  

The Quantity Theory of Money (QTM) predicts that a 10% increase in growth rate of money (M) will cause a _____ increase in the growth rate of real GDP (Y). 

In Androvia, output is made using this Cobb-Douglas production function: Y = 7K0.4 What is the marginal product of capital in Androvia?