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Suppose that natural real output in the country of Eudemonia grows at a steady rate of 3 percent per year. In the past, velocity has been approximately constant, and the Eudemonia Central Bank has maintained a target rate of growth of 4 percent per yard for the money stock. What would be the resulting rate of inflation? Now suppose that the introduction of Internet banking allows people to make transactions online without holding large amounts of currency or bank balances. As internet banking spreads, velocity begins to increase at a rate of 3 percent per year. What will happen to the rate in velocity if it pursued an NGDP target instead of a money stock target?
Consider the two-period consumption model of borrowing and saving. Suppose Claire has an income of m1 today and m2 a year from now and can borrow and lend at the interest rate r. She chooses consumption levels c1 and c2 given her well-behaved prefere..
If the firm's price elasticity of demand is equal to -2 (or 2 in absolute terms) illustrate what price should the firm charge in order to maximize profits
Crew Brew of Wisconsin plans to build a microbrewery on a small stream in that state. After sampling water from the stream, Chris Pierson has found that it is contaminated with pulp and paper waste from a local paper mill.
You are asked questions about 5 mutually exclusive candidates described as follows (all quantities are in thousands):Candidate 1: Present worth of costs = $1,000; Present worth of benefits = $8,000
Compute the (point) cost elasticity of demand when cost is $700. Is demand elastic or inelastic.
If there were 2 million unemployed Thailand had a job-finding rate of 15% per month, how many people would lose jobs each month.
Determine the conditions that may exist for a manager of this good or service may decide to move forward with operations even with the initial costs of operations is more than the potential revenue.
Illustrate what is James' opportunity cost of producing chickens. Which person has an absolute advantage in which activities.
What are Southwest Airline's Political, Economical, Social, Technical, Legal, and Environmental Issues currently facing the company?
Suppose in a survey of N = 400 students, 215 responded that they prefer small classes and 185 responded that they prefer large classes. Let p denote the fraction of all students who preferred small classes at the time of the survey, and ˆp be the fra..
Explain why you would not offer a loan to the next individual who applies for a car loan at your local bank at a higher interest rate than the bank pays on certificates of deposit.
Illustrate what is the minimum product price at which the firm will operate in the short-run. Elucidate how many workers should the firm employ to maximize profits.
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