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How does using interest rates as operating or intermediate targets lead to procyclical (reinforcing the cycle) monetary policy? How could policymakers use interest rates in the policy process and avoid pro-cyclical policy?
Assume that the MPC is 0.85 and that the Government is considering to boost the economy to increase real GDP by $2 trillion for the 2008 general elections.
The fear of unwanted price wars may explain why many firms are reluctant and suppose that a new machine tool having a useful life of only one year costs $80,000. Exam: 050474RR - MACROECONOMIC MODELS AND FISCAL POLICY
What are the differences between effective and aggregate demand and which one is most important in determining the equilibrium of Keynesian economy?
Find the equilibrium quantity and price. What is the total health expenditure on the services considered in the demand-supply functions?
Explain in a nontechnical way why demand is elastic in the northwest segment of the demand curve and inelastic in the southeast segment.
The plant engineer estimates the machine has a useful life of 5 years and no salvage value. Compute the depreciation schedule using: (a) Straight-line depreciation (b) Sum-of-years'-digits depreciation (c) Double declining balance depreciation.
At what quantity would a monopolist maximize profits given the following information about her costs and market demand. Total cost of production TC=3000 + Q2. Market demand is given by : Q=3200-2P. What is the firms revenue function,
Illustrate what would you expect to happen in the general economy if these rates are all increased.
Create a graph that shows Price on the Y-axis and Q demanded and Q Demanded and Q supplied on the X-axis.
Assume that a "leader country" has real GDP per capita of $40,000, whereas a "follower country" has real GDP per capita of $20,000. Next suppose that the growth of real GDP per capita falls to zero percent in the leader country and rises to 2 perc..
In 1982 to 1984 the base period used for the customer price index, the average earnings of construction workers were $442.74 a week.
Explain how it affects industry's margins forcing them to push up their product sale price etc.
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