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1. Monetary Intertemporal Model
Assume that last year there was a sectoral shock in Canada, and the economy has already adjusted to the new short-run equilibrium. On the goods market, the labour market and the money market diagrams, illustrate the economy's adjustment to its long run equilibrium only, as the formerly dislocated (and now retrained) labour force is finding employment in new industries.
2. Money surprise model
Show the effect of a fully anticipated increase in government expenditure on all three markets using respective diagrams.
3. Real Business Cycle Model
Suppose that a change in preferences has made consumers less frugal they are now willing to purchase more at every level of income and at every interest rate. Illustrate on all three market diagrams.
Assuming individuals hold no cash (all cash is in bank vaults as reserves), calculate the simple money supply from the following reserves requirements and deposits in the sy
Automotive Rebuilders, Inc., is considering a new automated assembly line to automate assembly of rebuilt alternators. The new line can be installed for $525,000 today and w
Perhaps the best way to ensure that the concepts are covered is to organize the paper by topic: 1) demand, 2) supply, 3) price elasticity, 4) cross elasticity, 5) income ela
Suppose that Second Republic Bank currently has $150,000 in checkable deposits and $97,500 in outstanding loans. The Federal Reserve has set the reserve requirement at 10%.
Where does the worker choose to work? Suppose the government regulated the workplace and required all jobs to have a risk factor of 1/5 (that is, all jobs become A jobs). Wh
Explain why in a monopolistic industry, if demand and cost curves are the same as those of a competitive industry, and if the demand curve has a negative slope and the suppl
What is the current annual inflation rate (based on the CPI-U) Summarize the major reasons behind this figure. What is the most recent numerical value of the CPI-U What ex
Draw a current budget constraint for an assumed single mother (net of child care costs) who loves leisure. Draw the new constraint. Discuss the likely effects on lab
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