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When the government runs a deficit, it spends more than it collects in tax revenue. To make up the difference, it borrows. So if it runs a deficit of 7 trillion ducats, debt increases by 7 trillion ducats. So debt next year is 147 trillion ducats. Suppose that there is no growth in real GDP and inflation is equal to -2% per year. (Negative inflation is the same as deflation.) Measured in ducats, what will GDP be equal to next year?
Assume which an innovation reduces a industry's fixed costs also reduces cost from ATC to ATC. Before the innovation reduced the cost, the industry's maximum economic profit was
Suppose you read in the newspaper that all last week the Fed conducted purchases in open market, and that on Tuesday of last week it lowered the discount rate.
compute the average cost function for skateboards. what shape does the graph of this function have. What is the average at this level of output.
Federal Reserve lowers the required reserve ratio from 0.10 to 0.05. How does this affect the simple money multiplier.
Movies are distributed in a variety of forms, not just first run theatrical presentations. What other ways are movies distributed. What are the different price points.
Suppose a consumer's preferences can be described. Derive the customer's marginal rate of substitution at the point.
Assume that the equilibrium price of DVD players increases and the equilibrium quantity increases. Illustrate which of the following best fits the observed data.
Also during that first year, the cookie business incurred costs that required outlays of money amounting to $9,000. What was Zach's economic profit (loss) for the year.
Use the 2007 numbers in the first column to compute, for each of the four countries, the percentage gap between the steady-state ratio.
If the actual price in this market were below the equilibrium price, illustrate what would drive the market toward the equilibrium.
Explain the argument that lower corporate tax rates can increase tax income in Kenya. Reflect on the Laffer curve in your explanation.
Demonstrate the short-run effect of this tax cut using the IS-LM model also the AD-SRAS-LRAS model. Illustrate what will take place to o/p also the interest rate.
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