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Fiscal Policy.
(a) The economic effect of an increase in government purchases is likely to depend on how the purchases are financed. Explain how an increase in G is increases output and employment if financed by a lump-sum tax (or debt), but is likely to decrease output and employment if financed with an income tax.
(b) The economic effect of an increase in government purchases is also likely to depend on the what the increased spending is used for. Suppose that the increase in spending is used to finance a school lunch program-goods and services that are viewed as perfect substitutes for privately-supplied school lunches by the private sector. Explain why such a program is unlikely to have much of an impact on output and employment even if it is financed with a lump-sum tax.
in some communities water is priced according to a two-tiered declining block method. according to this scheme an
What do you call it when the quantity demanded of a good falls when the price of a good rises, other things are equal?
Explain why do economists believe that the CPI overstates the rate of inflation
These problems from Macroeconomics and the problems deal with the expenditures of the whole economy. Various factors such as money supply, net export, governmental policy and aggregate demand.
In the early 1990's, a study found that moderate daily consumption of red wine reduced the incidence of heart disease in labratory rats. As a result of national press coverage of the report, the demand for red wine increased dramatically. Assume t..
Explain why the Fed must normally add reserves to the banking system via open market operations, on most days, in order to maintain its interest rate target in the federal funds market.
Estimate the above equation, comment on your results and test the hypothesis that β = 1, specifying clearly which is your null hypothesis - Construct two sub-samples from your dataset, where the first subsample contains small banks and the second la..
you are between jobs and have decided to relocate to a city east of the mississippi river but you are unsure of what
A bank loan has a quoted annual rate of 6%. However, the borrower must maintain a balance of 25% of the amount of loan, and the balance does not earn any interest.
Acme is sole supplier of security systems in product market and sole employer of locksmiths in the labor market. The demand curve for security systems is given by P=100-Q.
skills are required for current also future employees to possess for the organization to be successful
1. Which of the following industries comes closest to the model of perfect competition?
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