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If the government levies $20 billion in taxes to finance additional spending on military weapons, the net impact on total employment will be
a. a substantial increase in employment because the additional spending will create lots of jobs.
b. a substantial decrease in employment because the higher taxes will destroy lots of jobs.
c. small because the higher taxes will reduce spending in the private sector, which will tend to offset any jobs created by the government spending.
d. a substantial expansion in employment, but only if the additional spending leads to an increase in the general level of prices.
Assume a tax of t=$2 is attached to each unit exchanged in market. calculate the new market equilibrium and the deadweight loss from this change.
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Assume that the Fed perceives inflation on horizon and decides to follow a contractionary monetary rule. Describe the effects of this rule on the exchange rate of dollar.
Large-denomination time deposits: $ 304 billion Currency and coin held by nonbanking public: 438 billion
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Pedro loves playing rock music at high volumes. Mario loves opera and hates rock. Unfortunately, they are next door neighbors in an apartment building with paper thin walls.
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Elucidate a monopoly which formed naturally or through vertical or horizontal mergers.
This solution will focus on the negative impacts of NAFTA from two main fronts: the negative impact on trade and negative impact on employment.
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