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A. Give an example of an event or incident that has taken place in the U.S. economy which has a major economic impact--be specific, e.g., 9/11 attack, natural disaster, rise or fall in oil prices due to OPEC policies, consumer optimism or pessimism about an expected economic expansion or downturn, increase in government spending on healthcare, tightening of the legal and institutional environment, and so forth. What effect would this event have on AD or AS, other things being constant? What would be the resulting effect on equilibrium price level? Explain. What will be the effect of the different tools of fiscal policy to stabilize the economy? Give an example of a built-in stabilizer and explain how it would work to reduce this rise or fall in the level of AD.
B. Can you explain how fiscal policy (making changes to government spending and taxes) would affect aggregate demand (AD)? How do these two mechanisms of expansionary policy differ?
C. What were the major areas of disagreement between John Maynard Keynes and the classical economists?
A firm uses labor and machines to produce output according to the production function f(L, M) = 4L^1/2 M^1/2 , where L is the number of units of labor used and M is the number of machines. The cost of labor is $40 per unit and the cost of using a mac..
1.this question is about the theory of money demand.aconsider two financial assets a and b which could be quite
explain why airlines might be more likely to match price cuts than price increases. (b) Which theory of oligopolistic behavior does the above situation most resemble?
If the economy were at a steady-state unemployment rate with a separation rate of 0.02 per month and a job-finding rate of 0.10 per month, and the labor force was 100 million, how many individuals would lose their jobs each month?
Why might regulatory agencies utilize labor more intensively than private firms? What will happen to the regulatory share of employment if the rate of growth of regulatory employment stays five times higher than overall employment growth?
q1. if the impact of the u.s. imposed on japan voluntary export restraint of passenger cars to the u.s. from 2000000
Explain the key features of each of the the three generations of currency crisis models. Which of the three models best describes each of the financial crises discussed in this chapter? (Book-international finance and open-economy Macro economics by ..
What investment will you choose if your utility function were given by U(M) = M2 ? What is the certainty equivalent of the chosen investment?
Find the equilibrium price and quantity. Find the consumer and producer surplus at the equilibrium. Find the socially optimal level of output of paper. How can a corrective tax bring about this equilibrium? How much revenue would the corrective tax r..
Bob borrows $52000 from a local bank at an APR of 7.2% compounded monthly. His monthly patents are $52000(A/P, 0.6%, 54) = $1128 for a 54 month loan. If Jim makes an extra payment on the first month of each year, his repayment duration for the loan w..
Describe how many days before the due date the cesarean section should be carried out so that there is no more than a 10 percent chance that the woman will go into labor before that date.
Price Sensitivity/Price discrimination A physical therapy treatment can use a high tech machine to massage patients or a certified massage therapist. If the cost of the machine per unit of service is $100 and the cost of the therapist per unit of ser..
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