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In 200 word answers please explain the following economic questions
1. Explain how open market operations affect the money supply, interest rates, investment and GDP.
2. If output is above/below full employment, explain how and why an increase/decrease in wages and prices will bring the economy back to full employment.
3. “Fiscal and monetary policy are like matches: powerful tools, but not to be given to children or arsonists.” Explain.
Suppose the demand for Digital Video Recorders (DVRs) is given by Q = 250 - .25p + 4pc, where Q is the quantity of DVRs demanded (in 1000s), p is the price of a DVR, and pc is the price of cable television. How much does the quantity demanded for DVR..
Consider again The Experience Machine from Week 2. Would you get in the machine? Carefully explain why or why not. Utilitarianism is a deceptively simple moral theory that has quite a bit of intuitive appeal. But it also has its share of problems. H..
Is the price mechanism of a perfectly competitive market a good mechanism to allocate gasoline.
As conditions in short term financial markets improved by summer of 2009 the Fed closed down its lending under these programs. However, throughout the next 4 years the Fed increased substantially its purchases of longer term mortgage backed securitie..
q1. elucidate how a person who refuses an offer of employment in order to keep looking for a better job is counted by
Why do price gouging laws often fail to work?
Draw the intertemporal budget constraint. Be sure to label the axes, endowment point and the absolute value of the slope. Suppose that the individual’s interest income is taxed at 25% in both periods, and that interest payments are deductible at 25%...
Nobel laureate Paul Samuelson said that comparative advantage is one of the few ideas in economics that is both "true and not obvious." n 30 minutes, Kana can either make miso soup or she can clean the kitchen. In 15 minutes, Mitchell can make miso ..
Illustrate what do you think would be the short-run impact on the firm's production.
To purchase a house for $80,000, a new couple has $12,000 available for down payment. get a new standard mortgage with 10% APR interest compounded monthly for a 30-year term. What is the effective rate for option 2 per year? Compute the monthly payme..
Illustrate what happens to the equilibrium price and quantity in each market. Which product experiences a larger change in price.
The U.S. economy fell into a recession in 2001 and then proceeded into a slow-growth recovery due to a decline in investment. A. Explain how a change in investment can have a big impact on GDP causing a national recession.
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