Econ 302 Exercise Set 4

Course Instructor: Leigh Tesfatsion
Date Assigned: 19 March 1996



FOURTH TAKE-HOME EXERCISE SET [17 Points Total]      L. Tesfatsion
DUE DATE: Thursday, March 28, 9:30 A.M.         Econ 302/Spring 96

**PLEASE NOTE:  Exercise answers are to be turned in at the #beginning# of
class on the due date.  Late assignments will not be accepted---no exceptions!
Students are encouraged to work together on these and all future exercise
questions.  However, each student is required #separately# to pass in an
answer sheet in their own writing to minimize the danger of free-riding on
the work of others and consequent disaster on the final exam.

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EXERCISE 4.1 [4 Points]:   Hall and Taylor, Chapter 7,
NUMERICAL Exercise Number 6, page 205. Be sure to justify your
assertions and to label your graphs carefully.

     REMARK: The solution for the interest rate in Part d.
     is unrealistically large, so getting a large value of
     R does not necessarily mean you have made an error.

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EXERCISE 4.2 [3 Points]:   Hall and Taylor, Chapter 7,
ANALYTICAL Exercise Number 6, page 206. Be sure to justify your
assertions and to label your graphs carefully.

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EXERCISE 4.3 [4 Points]: Hall and Taylor, Chapter 7, MACROSOLVE
Exercise Number 1, page 207. Be sure to justify your assertions
and to label graphs carefully.  #All MacroSolve data that you
generate to answer this exercise should be appended to your
answer#.

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EXERCISE 4.4 [6 Points]:  Hall and Taylor, Chapter 8, NUMERICAL
Exercise Number 1, page 225.  Be sure to justify your assertions
and to label your graphs carefully.

     REMARK: Round-off errors can have quite an effect on your
     answers.  Try to avoid unnecessary round-offs and report
     calculations for decimal numbers using at least two decimal
     places.