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The UAW labor contract with General Dynamics expired in October 2001. IN the months preceding the expiration date, bargaining teams for the UAW and General Dynamics met to negotiate a new contract. All contracts must be ratified by the union members. Some of the many issues on the table included job security, health benefits, and wages. If you were an executive in charge of human resource issues at General Dynamics, would you be better of (a) letting the union bear the expense of crafting a document summarizing its desired compensation, or (b) making the union a take-it-or-leave-it offer? Explain.
Mention the four assumptions for the Monopolistic competition model.
Macroeconomics questions, discuss the short-run and long-run effects, Keynesian model, Distinguish between ongoing demand pull and ongoing cost push inflation.
The Lexus LS 430, the top of the line Lexus sedan, riad a base price in Canada of C$85,700 during the fall of 2005. Restated in US dollars using the exchange rate prevailing then, that price is $71,885.
A profit-maximizing monopolist never produces in the inelastic part of a linear demand curve. The short-run supply curve of a competitive firm is its MC curve.
With the help of an AD-AS diagram, explain the effect on the price level and real GDP. Use an upward sloping AS curve and be clear about the interconnections among markets.
Assume an economy in which the reserve ratio is 15 percent, people hold 10 percent of their deposits in the form of cash, and there are no other leakages.
Suppose planned investment falls by 100. Graphically illustrate using the AE-Y graph the effects of this reduction in planned investment on the economy. Also calculate the new equilibrium level of income.
What are the two problems facing the Bank of Canada in trying to control the money supply precisely?
According to the neo-classical economic theory, the market is a natural, self-regulating system that tends automatically towards the full employment equilibrium of supply and demand.
Using the IS/LM/BP model, demonstrate the effect of each of the following changes. Assume that the economy is a small country with perfect capital mobility and a flexible exchange rate.
Discuss how a change in price affects total expenditure by filling in each cell with resulting change in total expenditure.
How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.
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