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Large scale wars typically bring a suspension of international trading and financial activities. Exchange rates lose much of their relevance under these conditions, but once the war is over, governments wishing to determine the rate at which to fix their exchange rates face a problem of what the new rates will be. The PPP theory has often been applied to this problem of postwar exchange rate realignment. Imagine that you are a British Chancellor of the Exchequer and that World War I just ended. Explain how you would figure out the dollar/pound exchange rate implied by the PPP. When might it be a bad idea to use the PPP theory in this way? [Hint: UK's productive capacity decreased considerably during the war].
Realizing that the major function of benefit is to allocate resources according to consumer preferences, why are some groups in United States extremely critical of companies that earn increasing benefits
The annual rate of growth of real GDP in a developing nation is 0.3%. Initially, the countries' population was stable from year-year. Recently, however, a significant increase in the nation's birth rate has raised the annual rate of population growth..
What would happen to markets if the government instituted prices controls such as floor or ceiling? How does a Christian worldview influence these motivations?
The utility function of a worker is represented by U(C,L) = C X L, so that the marginal utility of leisure is C and the marginal consumption is L.
Explain the difference among a price floor also a price ceiling. Provide a situation in which a price ceiling may be used.
Evaluate how well the design of the First IB web site meets the needs of a potential small business customer. Discuss the elements of the site that work particularly well in meeting the needs of this type of site visitor.
QUESTION 1: For demand function P = 24 - 6Q- QUESTION 2: The income consumption curve
The government has placed a $10 per item tax on cat sweaters on the sellers. Below are the price elasticity of demand and the price elasticity of supply. For each question, tell the dollar amount of the tax the buyer will pay and the dollar amou..
Despite the advantages of outsourcing for companies, the practice has attracted much criticism from the US public and some politicians.
If an alternative has monthly payments of $10,000 a month for three years with a purchase price of $75,000 at the end of year three, what would the cash flow diagram look like?
What impact, if any, will this have the firm's AFC (average fixed cost), AVC (average variable cost), ATC (average total cost) and MC (marginal cost) and therefore these cost curves? Why?
Suppose a drop in the compensating wage differential between risky jobs and safe jobs has been observed. Two explanations have been put forward: Engineering advances have made it less costly to create a safe working environment.
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