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What effects would each of the following have on aggregate demand or aggregate supply, other things equal? In each case use a diagram to show the expected effects on the equilibrium price level and the level of real output, assuming that the price level is flexible both upward and downward.
e. The general expectation of coming rapid inflation.
f. The complete disintegration of OPEC, causing oil prices to fall by one-half.
g. A 10 percent across-the-board reduction in personal income tax rates.
h. A sizable increase in labor productivity (with no change in nominal wages).
i. A 12 percent increase in nominal wages (with no change in productivity).
j. An increase in exports that exceeds an increase in imports (not due to tariffs).
Jimmy has studied the bond market for the last century, and has determined that the real interest rate is 3.5%. He has also studied the stock market, and determined that the prevailing real growth rate of stocks is 7%. If Jimmy invests the inheritanc..
Explain whether or not you believe modern media is an effective check on government action.
Diogo has a utility function, U(q1, q2) = (q1^0.2)(q2^0.8) Where q1 is chocolate candy and q2 is slices of pie. If the price of slices of pie, p2 is $4.00, the price of chocolate candy, p1 is $ 2.00, and income, Y is $100, what is Diogo's optimal bun..
The gap between average total cost (ATC) and average variable cost (AVC) becomes larger when output increases. Marginal cost curve cuts the lowest point of the average cost curve.
The paying of a cash dividend causes the firms
What is the relationship between the ethical obligation of honesty and truth telling? Is it ever proper to not tell someone something he or she has a right to know? If so describe under what circumstances this might be the case How does this square w..
llustrate what happens to the money supply. Elucidate how would this change the incentive structure facing depository institutions.
Graphically show the impacts of a carbon tax on electricity producers. Using another graph, illustrate how a tax compares to a uniform air quality standard that imposes fees on electricity producers in non-compliance. Briefly discuss which policy is ..
Presently, AFC has on its medical staff 10 doctors and 10 nurses. The daily wage of a doctor is $600, whereas a nurse is paid only $200 a day. Is the mix of doctors and nurses the clinic is presently using optimal? Explain.
Write about the problem or issue as if you are explaining it to someone who has never taken an economics class. Be sure to explain the key concepts and terminology of both microeconomics and macroeconomics.
Based on your answers in a also b, how can you reconcile the president's statement with economics. Can you suggest how his statement could be modified to be consistent with the IS-LM model.
Graph the best response functions. Find the Nash Equilibrium of this game. What happens with the levels of law enforcement and crime (in Nash Equilibrium) when the cost of law enforcement c goes up?
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