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In the accompanying diagram, the economy is in short run macroeconomic equilibrium at point E1. Based on the diagram answer the following questions.
Is the economy facing an inflationary or a recessionary gap?
What fiscal policy can the government implement that might bring the economy back to long run macroeconomic equilibrium? Illustrate with a diagram and explain how the interest rate, real GDP and aggregate price level are affected by the policy.
What monetary policy can the government implement that might bring the economy back to long run macroeconomic equilibrium? Illustrate with a diagram and explain how the interest rate, real GDP and aggregate price level are affected by the policy.
If the government did not intervene, would the economy return to long run equilibrium? Explain and illustrate with a diagram.
Explain two prejudices that you carry and analyze how you can reduce those prejudices with the help of the prejudice-reduction techniques given in the textbook. Imagine you are a teacher in a classroom and you see a few students expressing prejudice ..
What is the percent value of the bond in the absence of inflation if the market interest rate is 8%? (b) What would happen to the value of the bond if the inflation rate over the next five years is expected to be 3%?
An increase to the federal minimum wage is a widely debated topic and a prominent concern of employees. This issue must be addressed by policy makers and compensation professionals. Support your argument by referencing a law that applies to minimum w..
A 50-kilowatt gas turbine has an investment cost of S40,000. It costs another S17,000 for shipping, insurance, site preparation, fuel lines, and fuel storage tanks. The operation and maintenance expense for this turbine is $500 per year. Additionally..
Explain the effects of monetary policies on the economy's production also employment
The following graph shows the market for loanable funds in a closed economy. The upward-sloping orange line represents the supply of loanable funds, and the downward-sloping blue line represents the demand for loanable funds.
q1. assume that serendipity bank has overload reserves of 8000 and checkable deposits of 150000. if preserve ratio of
A manager of a monopoly firm notices that the firm is producing output at a rate which average total cost is falling but it is not at its minimum feasible point. The manager argues that surely the firm must not be maximizing its economic profits. Is ..
When the price of one good decrease, the associated substitution effect is represented by a:
Calculate the percentage change in nominal GDP, real GDP and the GDP deflator in 2009 and 2010 from the preceding year. For each year, identify the variable that does not change. Explain in words why your answer makes sense.
Joe's starting salary as a mechanical engineer is around $80,000. Joe is planning to place a total of 10% of his salary each year in the mutual fund. Joe expects 5% salary increase each year for the next 30 years of employment. If the mutual fund wil..
Richard Pawlus was an owner of Dutch City Wood Products, Inc., which did business as “Dutch City Marketing”. Pawlus purchased merchandise from Rothschild Sun systems from April 24 to June 24 using the designation “Richard Pawlus Dutch City Marketing”..
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