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Assume you're advising the newly formed Russian government (formerly the Russian SSR) in 1991 regarding their policy toward State and Collective Farms in agriculture, which were both very large individually, with State Farms (Sovkhozy) being much larger, with thousands of workers, machine-tractor stations, etc.. Both types of organizations had grown unwieldy and inefficient and received various government subsidies. Construct a program that you could recommend to the government for privatizing these farms, which would immediately lower the incomes of the subsidized farmers, without creating a political disaster. Is there a way in which a plan could provide incentives to the Farm members that would have a good chance of raising productivity and lead to increased agricultural output while at the same time eliminating subsidies?
Show in an IS-LM and AS-AD graph the effects of an increase in government spending. Next, using the same graph, show how the economy will transition back to the natural rate of unemployment. Explain intuitively how this transition takes place.
Illustrate what would happen if CPI decided to raise prices unilaterally in this toothpaste market.
We have learnt that in a perfectly Competitive market, all cost savings from a technological advance are passed along to cnsumer in the form of lower prices
What is her marginal rate of substitution when L = 100 and she is on the budget line? What is her reservation wage? What is her optimal combination of C and L?
Assume a nation has been running a significant expansionary fiscal policy for many years.
Illustrate what was the effect of these rate reductions on revenue flow into the federal treasury. What impact upon our economy from these individual tax rate reductions.
Assume you executed a 90-day forward contract to exchange 100,000 Swiss francs into US dollars. How many dollars would you get 90 days hence.
Suppose in a closed economy, government spending is $60, business investments are $120 and consumers' spending is given as C = 120 + 0.85Y. What is the equilibrium level of output?
Compute the level of GDP per capita in each country measured in local currency. Compute the marker exchange rate between the currencies of two countries.
State with brief reasons whether the following statements are true, false, or uncertain.
The questions posed are broad and open ended so be careful to allow yourself enough research and planning time.
Find out the income elasticity of demand. Elucidate whether gas is a normal or inferior product.
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