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An economy has the following consumption function:
C = 200 + 0.8DI
The government budget is balanced, with government purchases and taxes both fixed at $1,000. Net exports are $100. Investment is $600. Find equilibrium GDP. What is the multiplier for this economy? If G rises by $100, what happens to Y?
What happens to Y if both G and T rise by $100 at the same time?
Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?
Discuss some of the damaging effects deflation has on an economy and what would be a monetary policy prescription to decrease or eliminate deflation?
Prepare a chart that lists three strengths and three weaknesses of the Consumer Price Index calculation.
Assume that initially equilibrium was 200 units and that this was also full employment level of income
Explain why would you expect inflation rate to increase if the actual unemployment rate refused to a level lower than the "full employment" unemployment rate.
Allied Box offers mail order storage containers for fine china producers. The firm is low-cost provider of these boxes with fixed cost of $480,000 per year,
Show the first and second order condition for profit maximization. Illustrate what is the price elasticity of demand faced by this monopolist.
What feature in this example leads to the result that you don't need to know the amount of taxes collected by the government to find the equilibrium?
Use graphical examine to demonstrate the gains and losses resulting from the migration of population from a low-income country to a high-income country.
A monopolist produces according to the following demand curve: p=200 - 4Q. Assume that the firm faces a constant marginal cost and constant average total cost of 60 per unit produced. A.calculate the optimal output that this monopolist should prod..
Given below is a table with total information for a firm in a perfectly competitive industry.
With a U.S. marginal propensity to consume, assumed at 1/2, what will happen to the following with the neoclassical model of national income if the Bush Tax Cuts expired
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