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1.Why do countries like the United States, Germany, and Japan all seem to be converging to the same level of per capita GDP?
2.
Dear Colleagues,
In The Wealth of Nations, Adam Smith wrote:
It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our necessities but of their advantages.
The Wealth of Nations, Book I Chapter II
A personal note about myself; I volunteer teaching financial literacy and job training skills to incarcerated women.
Suppose you were recently released from prison and working on your first interview meeting.
From the following two skits, which one would you choose and why? The interviewee is “Mr. Adam Smith”.
Skit 1: You - Dear Mr. Smith, thank you for considering me for this position.
Mr. Smith - You are welcome and thank you for meeting me. Tell me about yourself
You Thank you Mr. Smith. I really need this job as I have 3 kids, my son is somewhere in Kentucky, my daughter is abused by her boyfriend and my third child live with my mother in Chicago. My Mom has diabetes and my Grandmother has cancer and I need to support them as they do not have insurance …….
Mr. Smith - Thank you for sharing and we’ll get back to you in two weeks.
You Thank you Mr. Smith.
Skit 2
You - Dear Mr. Smith, thank you for considering me for this position.
Mr. Smith - You are welcome and thank you for meeting me. Tell me about yourself
You As you can see Mr. Smith, I have been in prison for 4 years for selling drugs. Being in prison is tough as you need to have the requisite skills to survive. This usually means you need to negotiate with fellow prisoners, for example, “I’ll give you a piece of cake if you give me your ice cream.”
Mr. Smith - Thank you for sharing and we’ll get back to you in two weeks.
You Thank you Mr. Smith.
Given the above quote by Adam Smith, “Which skit do you believe would give you a higher chance of obtaining the job and why?
3.Suppose commercial Bank A receives a new $100 deposit. a. What will be the total change in money supply as the result of this increase in deposits? Explain in detail. b. Discuss any ONE reason why the total change in money supply can be less that your answer in part a). (Think about what does the change in money supply depends on).
1.countries like us,germany and japan seem to be meet to the same level of per capita GDP .because GDP per capita meaning gdp divided by countrie's population .and the population of all these countries are so high with great level of production .standard of living is a measure of GDP per capita .and the standard of living of all these countries are maintain because they are best example of self relient countries .strandard of living is reach at their top level beacuse the government of these three contries work on health protection ,medical care , education sysment ,preventing discrimination ,equitity of income distribution . These basic foundation helps to build a great environment , they enhance working capicity of per labour. beacuse of higher level of employment, standard living of these countries looking appropriate. these countries production that are bought and sold in the markets and the other relevent elements thart affect people well being are well managed by the governments.these countries evironmental cleanliness check , how much population can read and write, how the death rate of infats fall down are made a remarkable strandard of living for the peope who are living these .the GDp growth rate of these three contries rises year by year with these bench remark so their Gdp per capita are meeting at same level.
2.
Skit 2 has higher chance of having the job.
Skit 1 describes the importance of me having a job and how it would support my family.
In the skit 2, though I'm from a prison, I've presented my quality which would help Mr.Smith especially in the negotiation.
As per Adam Smith, we address not according to the humanity but according to the self-benefits. Mr.Smith has some self-benefit addressed in skit 2.
3.
a. The total change in money supply will be multiplier times the increase in deposits
Increase in money supply = (credit multiplier)*100 = 100*k, where k = 1/rr or (1 + cd)/(rr + er + cd) in the more complex case, where rr = required reserve ratio and cd = currency/deposit ratio, er = excess reserve ratio.
b. One reason why the total change can be less than part a) -
> Fall in value of multiplier, which can be a result of increase in required reserve ratio(rr), in that case the multiplier will fall and thus the total change in money supply will be lesser than part a), as multiplier is inversely related to required reserve ratio.
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