1. How do the business cycles and the health of the economy affect the value of your labor? In terms of supply and demand, what are the optimal conditions in which to sell your labor? How might further education increase your mobility in the labor market (the value of your labor)?

2. View the video "Interview Questions for Choosing a Financial Planner" at (this is located outside of Baker College - you will have to open this in a new window):

Interview Questions for Choosing a Financial Planner.

Which advice about getting financial advice do you findmost valuable?

Also view this video on if people should consider getting a financial advisor:

Do you need a financial advisor? How do you know when you need a financial advisor?

3. Examine your budget and distinguish between wants and needs. How do you define a financial need? What are your fixed expenses, or costs you must pay regularly each week, month or year? Which of your budget categories m for first before satisfying others? To what extent is each of your expenses discretionary---under your control in terms of spending more or less for that item or resource? Which of your expenses could you reduce if you had to or wanted to for any reason? 4. Using the format a cash flow statement, prepare your cash flow statement for the same one-year period. Include your cash flows from all sources in addition to your operating cash flows---the income and expenses that appear on your income statement. List all your assets, liabilities and debts, and your equity from all sources. What does your cash flow statement tell you about your current financial situation? What does the balance sheet show about your financial situation at this moment in time? If you wanted to increase your liquidity, what would you do to change your cash flows; and how would your balance sheet need to change?

5. Identify the last two items (consumer goods and durable goods) you purchased. Alternatively, select anytwo items you purchased during the last two months. Choose diverse items and analyze each item in terms of the following factors:

a.Why did you buy that item? How did you decide what to get?

b. What attributes proved most important in narrowing your choices?

c. Where did you get your information about the item?

d. Where did you go to buy the item?

e. In what kind of market did you make your purchase?

f. Where did the money come from for your purchase?

g. How much did you pay for the item, and how did you pay for it?

h. How would you rate your satisfaction with your purchase?

i. If or when you purchase that type of item again, what might you do differently?

6. For a car you would like to drive,calculate and compare what it would cost you to buy it and to lease it. Use the Lease versus Buy Calculator. What would be the advantages of owning the car? What would be the advantages of leasing it? For your lifestyle, needs, and uses of a vehicle, should you buy or lease?

7. You are considering purchasing an existing single-family house for $200,000 with a 20 percent downpayment and a thirty-year fixed-rate mortgage at 5.5 percent.

a. What would be your monthly mortgage payment?

b. If you decided to buy two points for a rate of 5 percent, how much would you save in monthlypayments? Would it be worth it to buy the points? Why, or why not?

c. When should you consider an adjustable-rate mortgage?

8. A country with a population of eight million adults has five million employed, 500,000 unemployed, and the rest of the adult population is out of the labor force. What's theunemployment rate?

9. A country with a population of eight million adults has five million employed, 500,000 unemployed, and the rest of the adult population is out of the labor force. What share of population is in the labor force?

10. A country with a population of eight million adults has five million employed, 500,000 unemployed, and the rest of the adult population is out of the labor force. Sketch a pie chart that divides the adult population into these three groups.

11. Suppose the adult population over the age of 16 is 100 million and the labor force is 75 million (of whom 50 million are employed). How many people are "not in the labor force?"

12. Suppose the adult population over the age of 16 is 100 million and the labor force is 75 million (of whom 50 million are employed). What are the proportions of employed, unemployed and not in the labor force in the population? Hint: Proportions are percentages.

13. You will tell us two truths that you have found out this week about insurance. You are also to tell us a lie. It will be the goal of our posts to figure out which one is the lie. 14. From the perspective of macroeconomics, what is the difference between savings and investment? Why are both important for capitalistic economies? How do the loanable funds market and financial intermediaries link savers with investors? How do the supply and demand for loanable funds determine interest rates? 15 How do the average and marginal propensity to consume affect economic equilibrium and the output multiplier? Why is the multiplier important when evaluating the effects of possible macroeconomic policies?

16. Identify a supply shock, such as the introduction of a new technology that has major effects on one or more industries (e.g., the spread of the Internet, hydraulic fracturing) or change in the cost of a widely used resources (e.g., energy, agriculture). Explain, using the AD-AS model, how that shock affects the aggregate supply curve and equilibrium GDP and prices.