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In recent years, consumption spending by households has accounted for about 70% of the total spending (aggregate demand) in the U.S. economy. There are 5 determinants that might shift the consumption schedule of the economy, household wealth; household expectations; the real rate of interest; household debt; and taxes. How do you believe they are affecting the consumption schedule of the U.S. economy today (2009)?
Using indifference curve analysis, explain and show graphically the effects of higher gasoline prices on:
Explain the impacts of an expansionary fiscal policy such as a tax cut on the levels GDP, Consumption, Investment, interest rate and unemployment and price.
A symetric information can have deleterious effects on market outcomes. Discuss a few tactics that managers can use to overcome these problems.
When and why were the inflation and unemployment rates negatively correlated? When and why were the inflation and unemployment rates positively correlated?
You are a budget analyst in a California State legislative budget committee and have been asked to prepare a policy brief on the budget issue for the state.
Why is it not surprising to find that in an oligopoly which sells a basically undifferentiated product like chicken growth hormone all the firms change prices simultaneously, even if there is no explicit price fixing?
Explain why this strategy may in fact, be rational Also, identify at least two other strategies that might permit Argyle to earn higher profits.
Social Dynamo Corporation earned profits last year of $49 million on sales of $500 million. During the same period, its major competitor - EIO Corp.- enjoyed sales of $490 million and earned profits of $52 million.
Explain what happens to the position of the nation's short-run Phillips Curve if the following events occur:
Discuss how the aggregate expenditure function shifts in response to changes in each of time following variables:
Why the price of computers dropped as their power and features has have increased?
Exchange and markets, Demand supply and market equilibrium
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