I have this economics assignment

Posted on 2014-11-07 07:23:00 in Economics by ALAN

1. A busy attorney regularly works out with the help of a trainer at the local gym. She pays $400 per month directly to the trainer for this service. Over time, the two fell in love and got married. They still work out together (just like before) and she still gives him $400 per month but they both consider the money to be “spending money”. Assuming that this is the only think that changed, what happens to the GDP? Carefully support your answer.

2. Many economists argue that the official unemployment rate understates the true level of unemployment. Summarize these arguments.

3. City of Frederick is considering an adoption of rent control to keep apartments affordable for low-income families. Using a carefully labeled diagram of market for apartments, show and explain the short run effects of this new policy on rents and availability of apartments. Carefully explain whether this will achieve the implicit goal of the policy makers to keep apartments available for low-income residents. Also, describe the short run and long run impact of this policy on the availability of apartments in the Frederick area.

4. Over the past 30 years, demand for nurses has steadily increased especially recently when number of nursing home residents have increase. At the same time, more career opportunities have opened up for women and less women are choosing nursing careers. All through this, hospitals were fairly successful in keeping nursing wages lower. Draw a carefully labeled diagram that captures this scenario for the nurses. Using you diagram, analyze whether the market for nurses is in equilibrium or not. If not, is there shortage or surplus of nurses? In the long run, what do you think will happen to this market? Carefully support your answer.

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