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Explain how the NBC Learn clip concerning optimism and certainty affect aggregate demand and hence, consumer spending. Make sure you say how the aggregate demand curve would shift for both optimism and pessimism in the economy.
Assume that Congress imposes a tariff on imported autos to protect the U.S. auto industry from foreign competition.
Describe the goals of the factory owners? Describe the goals of the employees? Describe the problem caused by the scarcity. What is the price of a life.
Use a graph to demonstrate why a profit-maximizing monopolistically competitive firm must operate at excess capacity. Explain why a perfectly competitive firm is not subject to the same constraint.
Suppose Uncle Nacho sells shares of Time Warner stock for $20,000 and puts the proceeds from the sale into his money market mutual fund account. What happens to the value of M1 and to M2?
Assume that the inverse demand function for a two period depletable resource is P =24 – 0.2q and the constant marginal cost of supplying it is $6 (a = 24, b = 0.2, c = 6). What would be the efficient price in the two periods? What would be the margin..
The Euro zone fell into deflation in October (see Chart): prices fell by 0,2 % . Italy has experienced deflation for a few months. Unemployment in Italy is over 13% with youth unemployment 43.9% Contractionary policies in Italy have led to a fall in ..
Suppose you were worried that national income did not adequately take into account the depletion of the stock of fish in the economy. Describe how you would advise the Commerce Department to take this into account in their calculation. Make up fictio..
Consider a company that produces dog toys. The only resources that the company uses to produce these toys are Capital (i.e. machines and raw materials) and Labor (i.e. workers). The company sells 10,000 toys a month at $100 per toy. Write down the to..
Consider a firm with the production function, q = (K^(0.5) + L^(0.5))^2. In the short-run, the level of capital is fixed. Determine the equations for MPL and APL. Solve for the short-run cost function (i.e. total costs as a function of output) Solve ..
When a dynamic labor market is operating efficiently, mostly cyclical unemployment will be present. Some unemployment will be present even when a dynamic labor market is operating efficiently. When full employment is present, the rate of unemployment..
This year is expected to be a great one for selling walking shoes in Georgia. At very low prices, only the most efficient shoemakers are able to sell. There are two shoe producers that operate with the most cost-effective equipment and skilled person..
If the tax multiplier is -1.5 and a $200 billion tax increase is implemented, what is the change in GDP, holding everything else constant? (Assume the price level stays constant.) Suppose real GDP is currently $12.5 trillion and potential real GDP is..
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