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1. A. Explain the main differences between demand-pull inflation and cost-push inflation.
B. Analyze the differences between cost-push inflation and built-in inflation.
2. A. Does the official unemployment rate understate the “true” degree of unemployment in the United States?
B. Assume that you owe $5,000.00 to Capital Bank. Would you gain or lose from an unanticipated decrease in inflation?
Hyman Minsky’s “financial instability hypothesis” employs the key concept of financial “fragility.” What does it mean to describe a financial environment as “fragile”? Finally, on what grounds does Minsky also claim that, in the long-run (over the co..
In the numerical example given in the text, the inverse demand function for the depletable resource is P = 8 -0.4q and the marginal cost of supplying it is
Suppose that the demand curve for wheat is Q = 100 - 10p and the supply curve is Q = 10p. The government imposes a price ceiling of p = 3. Describe how the equilibrium changes. What effect does this ceiling have on consumer surplus, producer surplus,..
If national savings remain unchanged and net capital outflow falls, what will happen to domestic investment (I)?
Assume a competitive industry in long-run equilibrium. The industry exhibits increasing costs. All the workers in the industry earn the minimum wage. Suppose the minimum wage is increased by 15%. What is the short-run response of the industry and the..
Would Boeing's margin likely rise or fall if the yen then depreciated as well as competitor prices were unchanged.
Suppose you need to remove 70 exotic fish from a lake into which they were unintentionally introduced. You have three possible removal methods, methods 1,2 and 3. How much of each method should you use to achieve the removal cost effectively. Why isn..
What is the Deadweight loss cause by the insurance policy? What happens to the size of teh deadweight loss if it turn out that the marginal external benefit of visiting the doctor is $50?
An apparel manufacturing plant has estimated the variable cost to be $4.50 per unit. Fixed costs are $500,000 per year. Forty percent of its business is with one preferred customer and the customer is charged at cost. If 150,000 total units are sold ..
The demand for housing is often described as being highly cyclical and very sensative to housing prices and interest rates. Given these characteristics, describe the effect of each of the following in terms of whether it would increase or decrease th..
Suppose that they are thinking of each specializing completely in the area in which they have a comparative advantage, and then trading at a rate of 2.5 pounds of potatoes for 1 chicken, would they each be better off
Ryan and Asha produce water skis and wakeboards. The first table shows Ryan’s production possibilities and the second table shows Asha’s production possibilities. Each week, Ryan produces 5 wakeboards and 40 water skis and Asha produces 10 wakeboards..
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