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Part 1: Define what is happening in the economy when a country is in an expansionary mode, a recession, and a depression. Which economic indicators do we monitor to ascertain where the economy is in the business cycle.
Part 2: As an economic advisor to the president, suggest 4 ways to increase aggregate demand using the following economic concepts. Make sure you answer in the context of the equation for GDP, which is AD (Real GDP) = C (Consumption) + I (Investment) + G (Government Spending) + (E (Exports) - IM (Imports). All creative ideas are welcome!
What is the difference between supply-side and demand-side economics? How do the above concepts fit into these definitions? Which do you agree with most as a solution to stimulating growth, and why?
Why might a parent company like McDonalds or Hilton choose to franchise its local outlets rather than own them and staff them with employees In many smaller cities all McDonald's outlets are owned by the same franchisee. Why is (or isn't) this fac..
Explain how the concepts of total utility, marginal utility, and utility maximization.
The rising stock market implies an increase in wealth, at least as measured on paper. If we assume that some of this increased wealth gets consumed, then the rising stock market fuels an increase in aggregate demand, and may contribute to an inflatio..
Do workers choose to work more because wages are temporarily high and do workers choose to work less because wage are temporarily low? This is key to the "intertemporal substitution" story of this chapter. The following chart shows how much wages ..
Raising chickens requires several types of feed, such as corn and soy meal. Consider a farm in the former Soviet Union. Try to describe how dicisions on the number of chickens to be raised, and the amount of each feed to use in raising them, were ..
Assume the forex market equilibrium is given by i = ((i/E) - 1) + .1, where the two foreign return terms on the right are expected depreciation and the foreign interest rate. What is expected exchange rate? Solve for the IS curve: obtain an expres..
Let commodity 1st be bottled water, measured in gallons. Commodity 2nd denotes plain tap water, also measured in gallons.
A) Draw a graph illustrating this monpsonistic scenario with employer discrimination. Note employment and wage for black players and for equally talented white players. B) Explain why in this scenario both the employer and black employees are worse..
Assume that Florida migrant workers are effectively unionized. What will be the impact of unionization on?
Calculate the Marginal Propensity to Consume - Furthermore you know that the marginal propensity to save (MPS)equals 0.4
There is no Constitutional needs which individual states must accept monies offered by federal government to support requires affecting their citizens.
As per fiscal policy makers increase the budget deficit, monetary policy makers should increase the money supply
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