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If households decide to save a larger portion of their income, what effect would this have on the output, employment, and price level in the short run? What about the long run, assuming the government does not employ any stabilization policy?
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Begin your analysis by drawing an AS, AD, LRAS graph that shows the market in long-run equilibrium. In a second graph, show and explain the short-run effect of the change on P and Y. And in a third graph, show and explain the long-run effect on P and Y.
If the level of technology used in the production of a good improves, and assuming the quality of the good does not change, then: i. more output may be obtained with a given amount of inputs compared to before the technological improvement. a given a..
What is hyperinflation? Explain some factors that were responsible for the Zimbabwean hyperinflation of the late 2000s. In 2009, Zimbabwe ended its hyperinflation by adopting the U.S. dollar as legal tender. What potential problem(s) could this strat..
A specific McDonald’s franchise owner is looking at elasticities of Big Macs. E(p)= 2 (Price), E(i)=1 (Income), E(mt)=1.5 (m=Big Mac, t= Taco). The franchise owner would like to increase the price of Big Macs by 6%. If the owner wants to keep units s..
Suppose that County A has a money demand function given by Md= 50 + 2Y - 5r, while Country B has a money demand function given by Md = 50 + 2Y -25r. From this, we can conclude that
If you are available for work and have looked for a job at some point during the previous twelve months, but have not actively looked during the previous four weeks, you are considered. Suppose that you are available for work but have not looked for ..
If the government increases the income tax rate (t) and the central bank responds by increasing the supply of money, how will investment (I), saving (S) and money demand (md) be affected? Explain your answer with the help of an IS-LM diagram.
The mayor of Denver wants to upgrade the public transportation system. In order to fund the improvements, the mayor proposes charging an extra $1 for each ride taken.
Mike spends all his money on Jelly Beans and Gummy Bears and these two products are perfect substitutes for Mike. A few of Mike’s indifference curves are shown in the figure below. The dark line L is Mike’s budget line at current prices. The Jelly Be..
To write a research paper designed to educate the Governor on issues related to developing a sound urban economy. It is essential that you focus on the market forces that define the system of cities that would create a regional competitive advantage.
You should try to find an article (or articles) that discusses aspects of the market or market conditions that the firm faces. If possible, also find a SWOT (strengths, weaknesses, opportunities and threats) analysis for your chosen firm.
When Ajax co. Produced 3 units of output per week, its total fixed cost was $100 and total variable cost was $45. When output increased to 4 units per week, total fixed cost remained at $100 and total variable cost increased to $65.
If the economy was working at full-employment equilibrium, illustrate the state of equilibrium after the fall in consumer confidence.
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