# All Questions

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### Should unemployment caused by the government closing non-essential businesses during quarantine be counted as structrural unemployment?

I have following definition of structural unemployment: Long-term unemployment caused by shocks or permanent features of economy making it harder for certain workers to find a job So the answer to ...
7 views

### Applying Econometrics to Monetary Economics

I've been given a problem in which I am told that GDP is a function of the supply of money, prices and demand, $$Y = (M/P)^\delta$$ Taking logs, $$\log(Y) = \alpha + \beta \log(m - p) +u$$ ...
12 views

### Stimulus (Rescue) Package

With regard to the recent 2 trillion dollar coronavirus package, is the money just being printed or borrowed? A gentleman from the tax payer union claims the taxpayer will eventually be on the hook.
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### How's a levered hedge fund effectively selling a gigantic put option on its ability to finance its own positions?

I grasp the basics of a put option. John C. Hull. Options, Futures, and Other Derivatives (2017 10 edn). pp 8-9. A put option gives the holder the right to sell the underlying asset by a certain ...
297 views

### The Economics of Coronavirus

People are concerned about the economic impacts of the virus. How severe will the economic downturn be? Will the coronavirus cause a global recession worse than the 2008 crisis? I'm not looking here ...
17 views

### How can you profit from junk bonds and selling treasuries, if the junk bond doesn't default?

Junk Bond/Treasury convergence Typically junk bonds, given their speculative grade, are undervalued as people avoid them. Therefore the spread over treasuries is more than the risk of default, by ...
63 views

### What is the difference between trade deficit and current account deficit?

I read this article and still don't understand the difference. "Spends more money on what it imports compared to the money it receives for what it exports" (how it defines current account deficit). "...
4 views

### The derivation of Central bank's loss function?

How to derive the central bank's loss function?
18 views

### Given $f(x_1,x_2) = \min\{x_1,x_2\}^\alpha$ find the profit-maximizing factor demands, supply function and profit fuction

Given $$f(x_1,x_2) = \min\{x_1,x_2\}^\alpha$$ I have to find the profit-maximizing demand functions, supply function and profit function but I am not sure how to when the function is given as it is. ...
15 views

### Deriving a demand curve from a Cobb-Douglas utility

Probably a daft question but I derived an equation for a demand curve from a general Cobb-Douglas utility function $$U(x,y)=\beta x^{\alpha}y^{1-\alpha}$$ given a budget constraint $$M=xP_x+yP_y$$ and ...
9 views

### Intertemporal Slutsky and Endowment

To make sure I'm understanding Slutsky's equation and intertemporal choice correctly: given a choice between consumption today and consumption in the future, an increase in the interest rate will ...
143 views

### Why are my 2SLS estimates much larger than my OLS estimates?

When performing IV regression, it is often taken as a sign of unbiasedness if the IV estimates are similar to the OLS estimates of the same model. My question is: If the estimates are very different,...
123 views

### Why did Greece not solve its debt problem by selling treasury bond to its own people?

Since the Greek vehemently opposed the conditions imposed by the EU for the 3rd bailout, I don't understand why the Greek government did not raise the money needed to repay the previous loans by ...
23 views

### Is it detrimental if self-interest is not acknowledged in resource allocation situations?

Please note: I am doing a literature survey/review, and I would like references to published work. I contend that if we are dealing with a resource allocation mechanism that allocates scarce ...
95 views

### Is being a tax nomad possible at least in theory in a two or more states planet? [closed]

I define a tax nomad as: A person who works at least with a computation device and is frequently (say, about once in two years) relocating between different, two or more (federal) states, and, also: ...
434 views

### How to borrow at risk free rate

When learning about derivatives, we learnt about risk-free hedges and portfolios. However, one of the concepts was about borrowing and lending at the risk free rate. Now, for lending it's as simple as ...
21 views

### What should Lowe's(the home improvement company) do to keep their company profitable during the next recession?

During the 2008-2009 recession Lowe's lost money because they did not act fast. What can Lowe's do in the event of a new recession to prevent a similar situation from occurring again.
27 views

216 views

### Balance of payments and the free floating exchange rate system

I am a beginner economics student and recently, I have been learning about how balance of payments surpluses are important for a country to control the value of its currency using its accumulated ...
13 views

### Can the Federal Reserve's Quantitative Easing negative interest rates?

When I did my B.A. in economics, I never thought about extending $L(i)$ to negative y-axis. What if a central bank like the US Federal Reserve now quantitiatively eases more and shifts $\dfrac{M}{P}$ ...
13 views

### Does the sudden spike in the US jobless claim pose systemic risk to the US unemployment insurance system?

There has been an unprecedented short-term increase in US unemployment owing to the Covid-19 crisis. Initial jobless claims soared to a seasonally adjusted 3.28 million in the week ended March 21, ...
48 views

### Why does global suspension of economic activity result in catastrophic loss/debt?

Covid-19 has forced a suspension of at least 50% of financial transactions and business activities. Materially, not much has been lost: consumables have been spared, equipment is dormant, ...