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The US government is increasing its spending and cutting taxes. The Federal Reserve has reduced interest rates. The Obama administration hopes that the economy will begin to grow again without inflation.
Illustrate the position of the US economy over the next couple of years using aggregate demand and supply curves if these expectations are to be realized.
(Hint: Look at, among other things, budget deficits, bank credit to the private sector, prices paid for imports, and the exchange rate and food production and food availability)
What is the amount of the difference between the maximum premium and AFP, and what is this called?
Suppose that a perfectly equal distribution of income existed in Disneyland. Which of the reccent residents would have the same income he or she has in present distribution?
Assume the government imposes a tax of $2.00 per unit to reduce widget consumption and raise government revenues. What will the equilibrium quantity be?
Determine the profit-maximizing prices both firms will charge. In addition, calculate the price-cost margin for each firm and indicate which has more pricing power and why.
What money supply must the Bank of Canada set next year if it wants to keep the price level stable? What money supply must the Bank of Canada set next year if it wants inflation of the ten percent?
Efficiency and sustainability are management goals with respect to renewable resources. As Field explains, biological and economic considerations are typically blended in determining the efficient allocation of these resources.
Suppose a risk-averse consumer has an initial wealth of $5,000 and a utility function U(M) √M.. He faces an 80 percent chance of losing $4000, and a 20 percent chance of losing $0.
Assume the airline industry consisted of only 2 firms: American and Texas Air Corp. Let the two firms have identical cost functions, C(q) = 40q. Suppose the demand curve for industry is given by P = 100 - Q and that each firm expects the other to ..
Karen earns $75,000 in the current period and will earn $75,000 in the future. Assuming that these are the only two periods, and that banks in her country borrow and lend at an interest rate r = 0, draw her inter-temporal budget constraint.
Explain how a change in investment can have big impact on GDp causing nationwide slump. Recall that investment is "small' relative to the whole economy.
Use diagram to describe how each of the following events affects the equilibrium price and quantity of pizza (draw a separate diagram for each event)
How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.
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