Problem Set 1
Professor Nordhaus
Economics 154b: Spring 2006
Due: Wednesday 25, 2006
Problem Set 1. (Not graded)
General instructions: The best procedure is to first do the problem.
Then prepare a neat answer sheet based on your answer. You should
show all the essentials of your answer, but the answer should be
concise.
1. (From A-B, Chapter 2) Derive the national saving-national investment
identity that includes government purchases and revenues as well as the
foreign sector. Then go to the national accounts at www.bea.gov, NIPA
tables, Table 5.1 and show the actual numbers for 2004.
2. Do Abel and Bernanke, Numerical problem 1, p. 151.
2. Do Abel and Bernanke, Numerical problem 3, p. 151.
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