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Two identical countries, Country A and Country B, can each be described by a Keynesian-cross model. The MPC is 0.9 in each country. Country A decides to increase spending by $2 billion, while Country B decides to cut taxes by $2 billion. Find the tax and government multiplier for both countries. In which country will the new equilibrium level of income be greater?
Develop an estimate for each of the following situations.
Now suppose one big firm comes and buys out all of the firms in the cartel. This monopoly somehow miraculously is able to perfectly price discriminate. How much will this firm produce? What will be the deadweight loss created by this monopoly?
Illustrate why might Fourth of July fireworks be considered a public good. who should pay for them. what about airport security.
Describe the economic status of South Korea. What types of economic activities are most prominent there? What factors have led to your region's growth or lack thereof?
Which economic decision makers conclude the provider of labor. Illustrate what is their goal also illustrate what decision criteria do they utilize in trying to reach which goal.
Vietnam employs 40 million tons of rice a year. World price os rice is $500 per ton. Vietnam employs 10 million people in rice production with each working an average of 1000 hours a year. Which economy, California or Vietnam, has an absolute advanta..
Suppose that each worker in the Home country can produce three cars or two TVs. Assume that Home has four workers. Graph the production possibilities frontier for the Home country. What is the no-trade relative price of cars at Home?
Suppose Uncle Nacho sells shares of Time Warner stock for $20,000 and puts the proceeds from the sale into his money market mutual fund account. What happens to the value of M1 and to M2?
Elucidate how much in revenues do businesses receive in the product marketplace.
Which of the following is the correct definition of economic growth?
Why is this statement wrong: "Economists argue that lower prices will result in fewer units being supplied. However, there are exceptions to this rule. For example, in 1972, a very simple 10-digit electronic calculator sold for $120. Lower prices di..
Suppose that you had information about the amount of private savings during the years before and after the introduction of the Social Security program. How might you carry out a difference-in-difference analysis of the effect of the Social Security p..
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