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Changes in the shapes and locations of IS and LM curves
1. Discuss the factor(s) that determine the slope of the LM curve and whether an increase in theses factor(s) will make the curve flatter or steeper.
2. In words what does the IS curve represent?
3. What factor(s) causes the LM curve to shift?
4. In words what does the LM curve represent?
5. Is the interest rate we use in the IS-LM model real or nominal? How does your answer pertain to the shape of the aggregate supply curve?
In Bayonne, New Jersey, there is a large beauty salon and a number of smaller ones. The total demand function for hair styling per day is Q=180-10P, where P is in dollars.
Explain how does the timing of lay-off and hiring decisions made by firms explain the misleading characteristic of this indicator.
Suppose a friend you know requires a mortgage loan to purchase a house. Your friend can purchase it now or wait until later and is unsure of what to do.
Elucidate proportion of the variation in sales is explained by the independent variables in the equations
Suppose that there is an "inflation scare," that is, suppose market participants increase their expectations of future inflation.
Explain how will reduced smokers affect the GDP in the long and short run. What does increased revenue from cigarette taxes do to the deficit and budget.
Illustrate what would happen if the government intervened and lowered the maximum price that could be charged for this service or good. How would this change the output and price.
Describe the point elasticity of demand with respect to advertisement
A perfect competitive firm has the cost function TC = 1000 + 2Q + 0.1 Q^2-What is the lowest price at which the firm can break even?
Compute the income elasticity of demand for product below, by using average values for quantities and incomes.
Illustrtae what are the advantages and limitations of International Trade identified in the simulation.
Examine the contribution that automatic stabilizers play in creating a stable economy.
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