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Suppose P (domestic price) and P* (foreign price) are both increasing. Now suppose that the dollar experiences a 5% nominal depreciation.a. Which country is experiencing the higher rate of inflation if the domestic currency experiences a real appreciation? Briefly explain.b. Which country is experiencing the higher rate of inflation is the domestic currency experiences a real depreciation? Briefly explain.c. Compare the changes in P and P* if the real exchange rate does not change.
When the price of sugar was "low," consumers in the United States spent a total of $1 billion annually on its consumption. When the price doubled, consumer expenditures actually increased to $3 billion annually.
In doing so, she joined a long list of accomplished lawyers who have failed to pass the notoriously difficult examination, including a former governor who required four attempts to pass and a Los Angeles mayor who gave up after four tires. In the ..
Assume that all consumers have identical demand curves for local telephone service, and the producer of such service is a monopoly. Compare price, output, profit and consumer surplus when (a) the monopoly set a uniform price fir the product. (b) t..
One government strategy to provide for economic stability and encourage economic growth is to provide tax reductions or tax incentives for individuals and businesses. An alternative approach is to increase government spending to accomplish these g..
Calculate the unemployment and labour force participation rates in 2014 and in 2015 and what challenges would face the Greek government if they wanted to undertake fiscal policy to address the problems described in b?
Many companies are using computer mediated communication for training and updating their employees. They must choose the most effective and efficient manner of communication. Effective and efficient may be defined as achieving
Find the optimal consumption bundle if m1 = 100, m2 = 88, and r = :2. Is the consumer a borrower or a lender? How much do they borrow or lend per period?
Also, assume that the current Federal funds rate is at the 3 percent rate that is targeted by the Fed. Now suppose that the Fed retargets the rate to 1.5 percent. By how much will the quantity of Federal funds have to change for the equilibrium to ..
Find out the quantity demanded, the quantity supplied, and the magnitude of the shortage if a price ceiling of $30 is imposed in this market. Also determine the full economic price paid by consumers.
Studies of the effects of immigration into the United States from Mexico tend to find that the big winners are the immigrants themselves. How might things change if the border were open, with no restrictions on immigration.
Describe the market equilibrating process and compare the demand for food with demand for Starbuck's coffee. Include academic research to support your ideas.
)Now suppose that some of President's close political advisers are urging him to adjust taxes but not spending. Assuming the same initial level of G (=500), how would you advise the administration to adjust taxes to reach potential GDP?
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