Expected real income to remain unchanged

Assignment Help Microeconomics
Reference no: EM13695232

Assume that your current income is $50,000 per year and you expect inflation to be 5 percent over the next year

a. What must your nominal income be next year for your expected real income to remain unchanged? Briefly explain how you arrived at your answer.

b. Briefly explain what will happen to your real income if your nominal income remains unchanged next year and inflation has been 5 percent.

Reference no: EM13695232

Questions Cloud

Regression model of demand for durables consumers : Will there be any difference in the set of variables used in the regression model of demand for durables consumers (cars, appliances, furniture) and a regression model of the demand for "goods FMCG" (meals, beverages, personal care products)? Explain..
Retrofitted space heating system : A retrofitted space heating system is being considered for a small office building. the system can be purchased and installed for $120,000, and it will save an estimated 300,000 kilowatt-hours of electric power each year over a six-year period.
What effect mtv has on international relationships : What effect MTV has on international relationships? (for ex: MTV in Africa)
Assume a marginal propensity to consume : Assume a marginal propensity to consume (MPC) of 0.75. If the government increases spending by $20 billion, what will be the ultimate impact of this action in total spending in the economy.
Expected real income to remain unchanged : Assume that your current income is $50,000 per year and you expect inflation to be 5 percent over the next year a. What must your nominal income be next year for your expected real income to remain unchanged? Briefly explain how you arrived at your a..
Problems with Power plant maintenance and efficiency : Some of the Tennessee Valley Authority’s electricity generating plants are powered by coal purchased via a separate TVA procurement division. Power plant managers often complain that the coal is below grade and causes problems with plant maintenance ..
What will her principal outstanding balance be at that time : How much will Emily need to pay per month if she borrows the $300,000 needed to buy the house assuming a 20 year mortgage at the floating rate and How much will her monthly instalments be if she opted for the fixed term rate instead?
Price elasticity of demand for that motorcycle model : Suppose Suzuki increases the price of a particular motorcycle model by 12 percent and as a result the quantity demanded for that model decreases by 4 percent. Calculate the price elasticity of demand for that motorcycle model.
Different outcomes between perfect competition and monopoly : Explain the different outcomes between perfect competition and monopoly (“regular” monopoly). Use a single graph to illustrate this difference.

Reviews

Write a Review

 

Microeconomics Questions & Answers

  Practical problems in price theory

The problem in economics in price theory deals with deriving maximum marginal utility and marginal rate of substitution and price elasticity of demand.

  Develop a partial budget for a change in cattle production

Calculate the break-even weight for weaners. Show your calculations here and Develop a partial budget for a change in weaner cattle production.

  What is the npv and bcr

Using the data on costs and benefits provided what is the NPV and BCR associated with the project given a BCA period of twenty-eight years?

  Describe what actions led to the tariffs being imposed

Describe what actions led to the tariffs being imposed. Explain if protectionist trade policies are at play in this instance. Explain what the impact of a quota instead of this tariff would be.

  The kinked and the monopolist demand curves are the same

The Kinked and the monopolist demand curves are the same

  Examine evolution of the countrys monetary system including

select a foreign country and analyze its monetary system. research the countrys monetary system using at least five

  Calculate the change in consumer surplus

Calculate the change in consumer’s surplus, change in producer’s surplus, tax revenue, and deadweight loss as a result of the policy change. Illustrate them on a graph.

  Conduct a one-way anova analysis testing at 005 level also

a pharmaceutical company tested two new flu vaccines intended to boost immunity. in order to test the effectiveness of

  Detailed optimization calculations

Compute output, marginal cost, average cost, price, and profit at the average cost-minimizing activity level. Compute these values at the profit-maximizing activity level.

  Devastating impact on economies

Explain why hyperinflation has such a devastating impact on economies. Explain what it takes to stop hyperinflation

  Affects business strategy and management

Elaborate on how each affects business strategy and management: The business model/economic paradigm

  Managerial ethics-increased purchasing power conssumer

Which of the following is not one of the categories in which to classify managerial ethics? Two conditions must exist: (1) all firms in a given industry should be small (2) the number of firms must be large. Gross domestic product (gdp) refers to the..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd