This midterm will be held partially online using Respondus LockDown Browser and Respondus Monitor, and also have a take-home component

  • Online - you are allowed a pencil and sheet of paper
  • A calculator will be embedded
  • You should include this in your “environment check” at the start of the quiz recording
  • The take home exam will require you to scan and upload a single PDF. Apps are listed here - Scanning Apps

Some materials to study

  • Go back through readings & terms for all chapters related to modules and video lectures 1-7 (lecture 0 is not specifically on exam)
  • Review CQ1, CQ2, CQ3, CQ4, CQ5, CQ6, CQ7, paying close attention to the problems listed below:
    • CQ1: #5, 13
    • CQ2: #8, 24, 27, 28, 29, 30, 31, 32, 33, 34
    • CQ3: #5, 10, 11, 15, 16, 17
    • CQ4: #9, #13, & #14, and while you did OK on these other questions, please review (#1, #4, #5, #6, #7, #8, #11)
    • CQ5: #5, #8, #9, #11, #15, #16, #19, #22, #25, #26, #28, #29, #30, #31, #32
    • CQ6: #6, #8, #9, #11, #12, #15, #16
    • CQ7: #6, #7, #11, #12, #15, #16
    • Review FW0-7 for more help
  • Get a good grasp on the big questions. The exam is not limited to this, but these are the major point value questions.
    • Opportunity cost, comparative and absolute advantage
    • Cost benefit & decisionmaking
    • Factors of production
    • Production function & difference between total product, marginal product, and average product Y=AK0.5L0.5
    • Efficiency v. Equity
    • Positive v. Normative
    • GDP (nominal, real, potential, and per capita measures)
    • Growth v. cycle
    • Rate of change equation: %Δ=NewOldOld×100
    • Compound growth equation: PV=FV(1+i)n
    • Rule of 70
    • The economic takeoff-role of technology & institutions
    • Inequality within & between countries over time
    • Phases of business cycle
    • Fiscal v. Monetary policy
    • Labor market statistics: unemployment rate (U-3 or official): unemployedunemployed+employed
    • Labor market statistics: unemployment rate (U-6): unemployed+involuntary part time+discouraged & marginally attachedunemployed+employed+discouraged & marginally attached
    • Labor market statistics: labor force participation rate: unemployed+employedworking-age population
    • Labor market statistics: employment to population ratio: employedworking-age population
    • Types of unemployment: frictional, structural, & cyclical
    • Natural rate of unemployment
    • Okun’s Law: YYY=2(uu)
    • Price level, inflation, deflation, disinflation, accelerating inflation (and how to calculate given data)
    • Budget deficit/surplus v. debt
    • Trade deficit/surplus/balanced
    • Fisher equation: r=iπ
    • Money’s functions
    • Assets & wealth v. income, net income, & savings: which are stocks & flows?
    • Monetary aggregates: M0=Reserves+Currency & coins in circulation
    • Monetary aggregates: M1=Currency & coins in circulation+Deposits+Travelers Checks
    • Monetary aggregates: M2=M1+Savings (MMDA)+MMMF+Small-denominated time deposits (CDs)
    • Balance sheets: assets=liabilities+net worth
    • Importance of capital requirements & reserve requirements
    • Leverage ratio
    • Fed & its structure (who is chair?) and the FOMC structure
    • Central bank tools, targets, & goals
    • Review and practice problems calculating unemployment rates, inflation rates, interest rates and GDP growth rates
    • New Chapter for banking please read!!!
      • Firm structure & information issues (principal-agent, asymmetric information)
    • Taxation - progressive, regressive, proportional (flat) and how they relate to effective average tax rate
      • Effective average tax rate = total taxtotal income×100
    • Moral hazard & adverse selection
    • Gini coefficients & Lorenz curves - can you draw and solve???
    • Stock pricing and returns,
      • Div1ig or
      • P=Future Price+Dividends(1+i)
    • Div Yield=100×DivPrice
    • Bond pricing and returns
      • C1(1+i)1+C2(1+i)2++Cn(1+i)n+F(1+i)n
    • Relationship between interest rates and bond/stock prices
    • GDP calculation (nominal and real)
    • Growth rates of real GDP (finding annual averages)
    • Calculating inflation with GDP deflators and CPIs, GDP Deflator=NGDPRGDP×100
    • Calculating CPIs
    • Adjusting prices/wages to compare “real” values at various points in time (forwards and back) $\text{Nominal wage}\text{YR1}\times\frac{CPI\text{YR2}}{CPI_\text{YR1}}=\text{Real wage}_\text{YR2}$
    • Anticipated v. Unanticipated inflation
    • Calculate growth of real prices/wages
    • Supply and demand, manipulating curves and comparative statics
    • Surplus v. shortage
    • Basic understanding of price floors and ceilings
    • Understanding of market failure and externalities
    • Total savings, (Stotal=YCGNX)
      • OR (Stotal=Spublic+Sprivate+Sforeign=I)
    • Components of savings
      • National savings, (Snational=YCG)
      • Foreign savings, (Sforeign=NX)
      • Public savings, (Spublic=TGTR)
      • Private savings, (Sprivate=Y+TRTC)
    • The components of GDP, Y=C+I+G+NX
    • Economic v. financial investment

HELP on Compound Growth Equations (i.e., the Present Value Formula) and Gini Coefficients

HELP on Capital & Labor Markets and Unemployment

HELP on Banks and Lending

HELP on Bonds & Present Value

HELP on GDP, Savings & Inflation (also for Unit 6)