DSE 2006 paper discussion

[kangkan]

Hi...

http://economicsentrance.weebly.com/uploads/1/1/0/5/1105777/24_june_2006_option_a.pdf

ca some one help with question 28..it seems tat 0.12 is the obvious answer!!1

[ashutosh]

Caution! Question is asking for probability that he is man without unpaid balance.

Pr(man without unpaid balance) = Pr(person selected is a man) - Pr( he has unpaid balance)
                                           = .68 - .12 = .56

[kangkan]

oh damn..its without :)

[SoniaKapoor]

hey kangkan ..for ecotrix till which chap of basic ectx by gujrati needs to be done?

[kangkan]

for Dse..till chapter 9...if you have time try to do the chapters till 13....

[Nupur]

Are you talking about that 4th edition of Basic Econometrics? Does this mean Multicollinearity, Heteroscedasticity and Autocorrelation need not be done??

[kangkan]

i am using the fifth edition..accd to the study note of akshay,we need to do until dummy variables..but if you have time,do other parts too

[SoniaKapoor]

Okay thanxx Kangkan..!
Confirmed from my seniors too...till dummy variables need to be done...chapter 9

[Gayyam]

Hi guys,

Does anyone know the answer/explanation to questions 19,20 of this paper?

[Arushi :))]

20 because its fixed exchange rate regime if the govt changes the money supply , the rate of interest changes leading to appreciation or depreciation so fiscal policy is an effective tool for stabilizing economy.. so its c

[kangkan]

@gayyam....exchange rate overshooting-refer to  krugman chapter 14 and 15.

20. Ina  fixeed exchange rate sytem(as per mundell fleming model), monetary policy is ineffective and and fiscal olicy is affectve..dornbaausch(chapter on intl linkgages)

:)

[ashutosh]

q19
Exchangerate overshooting happens when due to expansionary monetary policy, exchange rate depreciates more than its long term level.

[Gayyam]

Thanks guys! This helped. :)

[Pam]

Hi,

Can someone please explain these questions: 38,45,50.

Here is the link to the paper:
http://economicsentrance.weebly.com/uploads/1/1/0/5/1105777/24_june_2006_option_a.pdf

Thank you!

[kangkan]

38..fiscal policy has the full multiplier effect when LM curve is flat...it is flattest when conditions of option a are satisfied

[kangkan]

45...increase in foreign income will push the IS curve to the right..but in a flexible exchane model, all changes in the IS curve are reversed due to exchange rate appreciation

[Pam]

Thank you kangkan :)

[phelps.phan]

guys pls explain 17, 48

[Arushi :))]

[phelps.phan]

thank you Arushi..I got 1/25 but since it was not in the options I was not sure..thanks :)