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Explain how natural monopolies Cause market failure? How is deadweight loss associated with this form of market measured? What is a typical form of government intervention to correct it? How effective is this type of intervention?
Santa Claus has preferences between milk and cookies. Draw indifference curves to represent the following types of preferences: a) Santa likes milk and cookies, and always gets the same satisfaction from 1 ounce of milk as he does 2 ounces of cookies..
What is the lowest the ex-ante interest rate can go if the nominal interest rate is 2.42%, given the change in Joe's inflationary expectations
Why does a union electrician earn less than a non-union electrician? Why does a white male earn more than a white female with the same level of education? Why does a movie actress like Angelina Jolie earn more than a movie actress from the 1940s?
Why is the money multiplier considered to be a potential multiplier rather than an indication of exactly how much multiplication should be expected?
We grow wheat that sells for $40,000. The wheat is milled into flour that sells for $55,000. The flour is used to bake bread that sells to consumers for $90,000. If nGDP is $9000 billion while rGDP is $12,000 then the GDP deflator is...
According to a study of US cigarette sales between 1955 and 1985, when the price of cigarettes was 1% higher, consumption would be 0.4% lower in the short run and 0.75% lower in the long run (Becker et al., 1994).
Use the green line (triangle symbols) to show the impact of this additional change in the exchange rate on the economy.
If interest rates remain unchanged, what is the expected capital gains yield, stated as a percentage, over the next year for Bond A and for Bond B.
For each of the following events, graph and explain the short-run & long-run effects on output and the price level, assuming policymakers take no action.
“Once we recognize that product differentiation is the basis for much international trade, there are likely to be more winners and fewer losers in a country when the country shifts from no trade to free trade.” There may be several reasons why this s..
How does nominal GDP targeting differ from real GDP targeting? Why is real GDP targeting the riskier of the two strategies? Currently, no major central bank closely targets the money supply. Why do you think this is the case? Still, no major central ..
Compute the (point) price elasticity of demand when price is $700. Is demand elastic or inelastic. Find the point at which point elasticity is equal to -1.
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