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Analyzing macroeconomic events with the IS curve (I) : Consider the following changes in the macroeconomiy. Show how to think about them using the IS curve, and explain how and why GDP is affected in the short run.
(a) the Federal Reserve undertakes policy actions that have the effect of lowering the real interest rate below the marginal product of capital.
(b) Consumers become pessimistic about the state of the economy and future productivity growth.
(c) Improvements in information technology increase productivity and therefore increase the marginal product of capital.
Consider the following market QD= 15-2P QS= 5P-2.5, with the government imposing a tax of 1.4 dollars per unit. Find the consumer, producer and total surpluses. What is the tax burden for each of the market participant?
Breaking news reports claim that household incomes are strong and growing. Assuming all other applicable indicators remain the same, how would you expect this to impact the position of the Demand Curve in the Product Market? You read an article that ..
Our constitution provides the citizens of the United States the absolute right of association and freedom of speech, do you think corporations should be considered people under the law and as such protected by the same rights as regular citizens? Exp..
What are the differences between economic and accounting concepts of cost? How are prices determined under perfect competition? How are prices determined under monopoly?
The board of a company has to elect a new CEO. Three members are on the board, 1,2,3. After a first round of selection, three candidates are left: α, β and γ. Preferences are as followed: Consider the game when all weakly or strictly dominated strate..
Other things being equal, which of the following is likely to result from an increase in oil prices that substantially decreases aggregate supply?
It takes a phlebotomist 10 minutes to complete a blood draw. The supplies for each draw cost $5 and the phlebotomist earn$25 per hour. the phlebotomy lab is designed to accommodate 24000 draws per year. its rent is 100,000 per year. what are the aver..
pecifies that the real wage will rise by 10 percent in the second year of the contract. The CPI is 1.00 in the first year and 1.1 in the second year. Illustrate what dollar wage must be paid in the second year.
Your pharmacy provides services to Medicare and PPO patients. You estimate a price elasticity of demand of -2.2 for Medicare patients and -5.3 for PPO patients. Your marginal and average cost for dispensing a prescription is $2. What is the profit-ma..
What is economics? Why is economics considered a social science? What role does economics play in your personal and professional lives?
q.consider two firms each of which is issued three marketable pollution permits. for firm h the marginal cost of
Define the natural rate of unemployment and cyclical unemployment. How does the government measure the economy’s rate of unemployment? What problems arise in interpreting unemployment data?
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