Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
a) Suppose that initially the economy is in a long-run equilibrium with no money growth, no inflation, and πe = 0%. Then, the central bank announces that, starting in the next period (t+1), the money supply will begin growing at 10%/period. What happens in the current period (t)? Show this on the IS/LM and AD/AS graphs. Assume that all adjustments occur instantly so you don’t have to worry about the path that the economy follows from the initial long-run equilibrium to the new long-run equilibrium. Just to be clear, there is no change M in period t.
b) Explain why the increase in i and decrease in M/P in period t make sense from the point of view of individual economic agents.
c) What happens in the next period when the money supply starts growing at 10%/period? Show this using both the IS/LM and AD/AS graphs.
d) Who pays the inflation tax and how? Who collects the inflation tax and how?
Illustrate what is the market elasticity of demand. What is your elasticity of demand in this Cournot oligopoly.
Suppose in a firm, the probability of worker injury is = 1/20. The losses from an injury is $100,000. Suppose the cost of residual uncertainty is $3,000 and the cost from other elements of cost of risk is zero. The value of firm without risk is $2 mi..
Do the hold out values fall within the forecast 95% confidence limits?
Report demand graphic as well as independent variables that are relevant to absolute a demand analysis providing a rationale for the selection of the variables.
W.V. Trees, Inc. has a debt-equity ratio of 1.4. Its WACC is 10 percent, and its pretax cost of debt is 9 percent. The corporate tax rate is 33 percent. What is the firm's unlevered cost of equity capital?
Suppose that a firm's fixed proportion function is given by q = (min{k,l})^.5. write the short run maximimization problem and derive the 1st order condition. If the wage is w=1 and the price of output is p=4, how much labor will the firm demand in th..
Max Corporation has $10,000 in retained earnings that it has not distributed to its stockholders as dividends. It has a choice to invest the funds in a certificate of deposit at a bank at a guaranteed rate of 7 percent, or to plow back the funds in t..
Suppose the velocity of money is constant at 5 transactions per year, the price level for this year is $1, and real GDP this year is $8,000,000. Suppose the economy's output of goods and services rises by 5% each year. What will nominal GDP be equal ..
The Australian dollar has appreciated strongly over the past decade, leading to increased concerns over the impacts of the high exchange rate on trade-exposed sectors of the economy".
In the Solow growth model, suppose that the marginal product of capital increases for each quantity of the capital input, given the labor input. That is, we relax the assumption that there are diminishing returns to capital and instead assume there a..
Suppose a country can produce a maximum of 20,000 jumbo airliners or 2,000 aircraft carriers. What is the opportunity cost of an aircraft carrier? If another country offers to trade six planes for one aircraft carrier, should the offer be accepted?
q. suppose there are two consumers a and b. the utility functions of each consumer are given byuaxy xyubx y 2x ythe
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd