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Consider a closed economy which can be characterized by the following equations: C = 400 + 0.8YD I = 600 + 0.1y- 1000r G = 300 T = 125 (M/P)d = 0.2Y-6000r (M/P)= 400 a. Solve for the goods market equilibrium and state the equation for the AD and IScurve. Draw both graphics. b. Solve for the money market equilibrium and LM and draw the graphics. c. Determine the equilibrium values for real GDP (Y), the real interest rate (r), private consumption(C), investment (I) and private saving (S). Show that in equilibrium total saving equals investments. Graphics d. Suppose that government uses contractionary fiscal policy and decreases government expenditures to G = 200. What happens to the equilibrium? (Repeat exercise (c) for the new government expenditures. Graphics. e. The Central Bank increases the money supply to 500. How this policy affects the final equilibrium? What is the new level of output and interest rate? Use graphics and explain
Illustrate what difference will it make to Sony pricing if clients have now become dissimilar?
Construction-based business of your choice and explain stakeholder theory to illustrate the primary interests of the stakeholder groups and identify any areas of potential conflict between the stakeholder groups.
The labor abundant countries of asia have experiences rapidly rising wages since those economies liberalized their international trade policies. Does this observation match the predictions of international trade theory? Explain.
Money acts as a unit of account, medium of exchange, or a store of value. Describe each of these different functions.
Suppose that in response to a foreign crisis, the government increases defense spending by $50 billion. How would the increase in defense affect the economy? How would the effects differ depending on the size and sign of the output gap when the cr..
Now suppose the factory develops an innovation that allows it to produce a shirt for the equivalent of 1 loaf of bread. What is the new radius of the factory's market area.
Mrs. Smith is earning a loss and should shut down in the short run. Mrs. Smith is earning a loss but should continue to operate in the short run. Mrs. Smith is earning a profit since the price is above the average variable cost.
Suppose two countries, A and B, with the same production function Y = K? L1?? . The value of is 0.30, the growth rate of population is 2% and the depreciation rate is 5%. Show that with price-taking firms the share of labor must be 1? Compare both e..
q.many developing countries in the global south turned to socialism in the past as a means to solve their economic
Calculate the elasticity for each variable at that point and briefly comment on what information this gives you for each variable.
21st century insurance offers mail-order auto mobile insurance to preferred risk drivers in the Los Angeles area.
q.1. suppose that ex is the exchange rate among the u.s. dollar and the chinese yuan in that ex indicates the number of
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