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Read the following statement and decide if it is True or False. Explain why you have made the choice you did. Eight marks are reserved for your explanation. The average household income rises by five percent and there is an increase in the demand for board games by 15%. Board games are normal goods but are income inelastic.
Is there either a recessionary output gap (negative GDP gap) or an inflationary output gap (positive GDP gap) at the equilibrium interest rate and, if either, what is the amount There is a recessionary output OR gap inflationary output gap of $.
Leon and Heidi decided to invest $3,000 annually for only the first eight years of their marriage. The first payment was made at age 25. If the annual interest rate is 10%, how much accumulated interest and principal will they have at age 65
Earl obtained a loan for 22000 dollars. He will pay it back in 17 months with an interest rate of 8 yearly compunded monthly. Each payment will be $200 larger than the previous payment. Calculate the amount of the last payment.
What happens to output, Y , and consumption, C ? What happens to investment, I ? What happens over time to the stock of capital, K ?
Suppose nominal GDP in 2005 was $14 trillion, and in 2006 it was $15 trillion. The general price index in 2005 was 100, and in 2006 it was 103. Between 2005 and 2006, real GDP rose by what percent
Assume Firm Y's production function is given by the following Cobb Douglas equation: Q = 0.5 x L0.6 x K0.5 where L denotes labor and K denotes capital. a. Does the production function exhibit increasing, decreasing or constant returns to scale
in an examination of purchasing patterns of shoppers a sample of 16 shoppers revealed that they spent on average 54 per
What is the maximum amount of new loans that can be created by the whole banking system as a result of this? (Include the excess reserves as part of the loans created and use your money multiplier)
A rich graduates of engineering program at your University wishes to start an endowment that will provide scholarship money of $40,000 per year beginning in year 5 and continuing indefinitely.
The plant has a capacity output of 200,000 calculators per year, and the plant's manager regards 75 percent of capacity as the normal or standard output. The projected total variable costs for the normal or standard level.
Currently, a typical fan pays an average ticket price of $5. The price elasticity of demand for tickets is -0.6. Management is thinking of raising the average ticket price to $5.50. Compute the predicted percentage change in tickets sold. Would yo..
Explain why the brain drain could lead to increased education among the remaining residents. How would you test this theory?
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