1. What phase of the business cycle is the Canadian and your provincial economy experiencing at the present time? Justify your answer.

Note – Use your own words and understanding. I will not accept standard definition answers, answers copied off the internet, answers copied from a classmate and then rogetted, formulas, etc. I am looking for your own interpretation of these concepts.

2. Compare and contrast the CPI with the GDP Deflator.

Note – Use your own words and understanding. I will not accept standard definition answers, answers copied off the internet, answers copied from a classmate and then rogetted, formulas, etc. I am looking for your own interpretation of these concepts.

3. Suppose an economy’s real GDP is $50,000 in year 1 and $55,000 in year 2. What is the growth rate of its GDP? Assume that population was 100 in year 1 and 105 in year 2. What is the growth rate in real GDP per capita?

You must show all work in order for the answer to be graded.

4. Describe in detail the adjustments in the production possibilities curves in each of the following situations for the Canadian economy.

(a) the economy moves from full employment into a deep recession
(b) the economy makes great strides in eliminating discrimination
(c) the end of the war in Ukraine leads to cuts in military spending
(d) the government significantly increases spending for health and education

Note: It is not enough to say – “curve shifts out”. You must carefully explain the impact on the PPC and the rationale/reasoning for the impact. As well, you want to be sure to include any other pertinent information from these concepts as discussed in this course, where appropriate.

5. In your own words, and as it pertains to the topics covered in this course, carefully describe three of the specific monetary policy initiatives that the Bank of Canada undertook in response to the COVID-19 pandemic.

This answer is worth 15 marks.

You must have three separate paragraphs, one for each monetary policy initiative you are describing.

Recommended word count is 400-500 words

6. (i) Explain how money overcomes the disadvantages associated with barter.

(ii) What conditions are necessary for people to accept paper currency in exchange for the goods and services, which they sell?

This is a ten-mark question. Be sure to include enough points and explanation considering this is a short essay style question.

7. Considering the variables included in the expenditure approach to GDP discussed in this course:

(i) Discuss how each variable was impacted by the COVID-19 pandemic.

(ii) Be sure to include the terminology and rationalizations used in this course to justify your answer.

Please be mindful that this question is worth ten marks so be sure to include an appropriate level of detail to explain both the variable, the impact, and the reasoning for the impact you described.

8. This question can be answered using a piece of paper and a pen or it can be done in MS Word. You will be required to upload your answer by submitting a file.

Using the AD/AS model describe and illustrate how the Covid-19 pandemic would lead to inflation.

1. In your written answer, you must describe a COVID-19 factor that would change each (i) aggregate demand and (ii) aggregate supply such that inflation results in the economy.
2. In your written answer you must demonstrate how the two forces you described above would result in inflation.
3. You must illustrate the changes you described above in a detailed and accurately labelled diagram.

Note: Your diagram can be made either in Word (as we have done in the past for our assignments) or it can be hand drawn on a piece of paper. You can take a picture of it and save it on your computer.