Demography can have important economic effects. The United States has an aging population. Explain one economic benefit and one economic cost of an aging population as well as of a population that is very young.
Explain why is it difficult to set aside funds for investment when you are in poverty.
Why do you think it is difficult for high-income countries to achieve high growth rates?
Is it possible to protect workers from being fired without distorting the labor market?
Explain what will happen in a nation that tries to solve a structural unemployment problem using expansionary monetary and fiscal policy. Draw one AD/AS diagram, based on the Keynesian model, for what the nation hopes will happen. Then draw a second AD/AS diagram, based on the neoclassical model, for what is more likely to happen.
Why are inflationary dangers lower in the high-income economies than in low-income and middle-income economies?
Explain why converging economies may present a strong argument for limiting flows of capital but not for limiting trade.