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A municipal highway department needs to repave a section of roadway. Concrete would cost $500,000, and lasts for 20 years. Asphalt can also be used, but it only lasts for 15 years, and requires resealing after 8 years at a cost of $50,000. At what cost of asphalt would it make sense to pave with that material? Use i = 6%.
Discuss the debate over whether the expansionary monetary or fiscal policy would have successfully pulled the U.S. economy out of the Great Depression. Discuss the changes i
Jimmy has studied the bond market for the last century, and has determined that the real interest rate is 2%. He has also studied the stock market, and determined that the pre
Two identical countries, Country A and Country B, can each be described by a Keynesian-cross model. The MPC is 0.9 in each country. Country A decides to increase spending by $
Price ceiling is the law that sets a maximum price below the equilibrium market price, but a price floor is the law that sets a maximum price above the market equilibrium pric
Elucidate reason for both wage and cost rigidities including policy implications for se rigidities. Would you conclude on se reasons suggested by New Keynesian economists as
If I had a $1, one year U.S. bond today, how much would it be worth in dollars one year from now? If I wanted to purchase one year U.K. bonds today, and all I had was $1, how
Use the Wall Street Journal article below “Copper Prices Slide to 5 1/2-Year Low” to analyze the recent changes in the market for copper. Demonstrate the changes in price on a
Consider the relationship between interest rates and inflation. Explain the difference between real and nominal interest rates. If the Fed takes actions that will change inter
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