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Short-run aggregate supply curve
(The Multiplier and the Time Horizon) Explain how the steepness of the short-run aggregate supply curve affects the government's ability to use fiscal policy to change real GDP.
Two identical firms face linear demand. Market demand is given by P=30-Q. Compare graphically consumer and producer surplus in Cournot and Stakelberg equilibria to perfect competition.
Consider the following Solow model of growth. Both population and work force grow at the rate of n=1% per year in a closed economy.
Suppose that the economy is short of its full-employment (potential) level of GDP, assumed to be $14,000 billion, by $500 billion.
Explain her change in consumption in terms of income and substitution effects (give a precise quantitative answer). Is this a Griffin good (how do you know)?
The kinked-demand schedule that an oligopolist believes confronts the firm is given in the table below. Compute the oligopolist's total revenue at each of the nine prices
Political business cycle: Do economic events affect presidential elections? To test this so-called political business cycle theory, Gary Smith 20 obtained the following regression results based on the U.S Presidential elections for the four yearl..
Discuss three automatic expenditures in the federal budget. What is the difference between discretionary fiscal policy and automatic stabilizers?
If velocity is unchanged and the money supply grows by 13% and the real GDP grows by 4%, what is the rate of inflation?
Keynesian thinking dominated US (and other developed-country) policy-making well into the 1970s, although the "classical" counter-arguments kept up a steady criticism:
Provide an example of how fiscal also monetary policies compliment or work against each other.
What are some of the positive externalities of education? Why may higher education offer fewer positive externalities than primary or secondary education?
Suppose that rich countries surprisingly commit to much higher official aid, to be maintained for several decades. What would be the effect of such aid on?
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