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How did Maynard Keynes propose to address the Great Depression? Did it differ from the Classical views? How does it compare to Monetarism?
For a competitive firm facing a market price above average total cost, the existence of economic profits means that the firm should increase output in the short run even if price is below marginal cost.
Using production theory, explain illustrate what will take place to the capital- labor ratio in both the short-run also the long run.
As we observed in this chapter, central banks, rather than purposefully setting the level of the money supply, usually set a target level for a short-term interest rate by standing ready to lend or borrow whatever money people wish to hold at that in..
If the average employee compensation grew at the rate of 3.5% per year, explain how many years would it take for it to double.
According to the Keynesian view “Businesses will undertake all investment projects for which the expected rate of profit equals or exceeds the interest rate.” Explain what this means.
Assume that the inflation rates in 2010, 2011, and 2012 were 1%, 2%, and 3% respectively. During the same periods, nominal interest rates were 5%, 5%, and 6%, respectively. What are the ex-post real interest rates in 2010, 2011, and 2012?
In this module, it is demonstrated that sometimes extensive diseconomies of scale, say, due to high transportation costs, would require that the firm produce its product in a multiple of plants. The average hauling (freight) cost is $0.8Q; that is AF..
Which industry is more highly concentrated: one with a Herfindahl index of 1,200 or one with a four-firm concentration ratio of 55 percent?
Suppose that both countries are currently producing three pairs of boots and three shirts. Elucidate that both can be better off if they each specialize in producing one good and then engage in trade.
ESPN currently pays the NFL $1.1 billion per year for eight years for the right to exclusively televise Monday Night Football. What is the net present value of this investment if the parent Disnery company has an opportunity interest rate equal to it..
Suppose you own a specialized auto parts manufacturer. You purchase and have installed a new machine to make a particular type of part. The price of the machine plus installation is $300,000. If you have already purchased the machine, should you go a..
Explain how do you think which these individuals would rank the utility of these similar expenses for themselves.
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