Discuss the effects on investment and national saving

Assignment Help Microeconomics

Reference no: EM132208284

Question: You work for Dr.Zhang, the autocratic dictator ofthe Republic ofZhouland. After taking an economics course, you decide that devaluing your currency (Zhoullars) is the way to increase GDP. Following your advice, DR.Zhang orders massive increases in the supply of Zhoullars, which reduces the value of of Zhoullars in world markets.

a. Use the AD-AS model to determine the effects of real GDP, unemployment and the price level in Zhouland in both the short run and the long run. Assume the economy was in long- run equilibrium before this change and consider only this stated change.

b. Analyze the effects on the market for loanable funds and the market for foreign exchange markets. Discuss the effects on investment, national saving, NCO, interest rate, exchange rate and Net export.

c. Assume that the Republic of Zhouland faces political instability and experiences a huge capital flight from its country. Repeat the same exercise you have done on question (b).

Reference no: EM132208284

Questions Cloud

Would domestic producers receive a sympathetic ear : Suppose Brazil developed a secret process that effectively quadrupled its output of coffee from itscoffee plantations. This secret process enabled.

What was the purpose of the executive retreat : Why did Nikko Hotels International choose the Essex House in New York City as its first property in the United States?

Do you agree or disagree with the view : Some have argued that higher cigarette prices do not deter smoking. While there are many arguments both for and against this view, some find the following.

Discuss the econometric models in detail : Second, search for similar works. It is totally fine just to replicate the empirical results of existing studies or updating them by applying new econometric.

Discuss the effects on investment and national saving : Analyze the effects on the market for loanable funds and the market for foreign exchange markets. Discuss the effects on investment, national saving, NCO.

Do you feel that lobbyists and special interest groups exert : Do you feel that scientists should be cut out of the policy making process, particularly on environmental issues.

Find the socially optimal level of emissions : Consider a good for which the production process generates external costs. The marginal external cost function is MEC = 7E, where E is the amount of emissions.

How political factors have influenced immigration policy : From the readings, explain how political factors have influenced Immigration Policy in the United States. Support your answer with examples.

Calculate the annual cost of the truck : Eight years ago, Ohio Valley Trucking purchased a large-capacity dump truck for $115,000 to provide short-haul earthmoving services.

User Account

All Pages