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A consumer receives income y in the current period, income y in the future period, and pays taxes t and t' in the current and future periods, respectively. The consumer can lend at real interest rate r. the consumer is given two options. First, he or she can borrow at the interest rate r but can only borrow an amount x or less, where x < we - y + t. Second, he or she can borrow an unlimited amount at the interest rate r2 where r2 > r. Use a diagram to determine which option the consumer chooses and explain your results
What would happen if suppliers charge less than the equilibrium price for your good or service.
How can you justify existence of government-granted monopolies for such public utilities as local telephone service, natural gas.
Firm is contemplating replacing a computer (D) it purchased three years ago for 6,000. In two years it will have a salvage value of $800. Operating a maintenance costs have been $1,000 per year. The computer currently has a trade in value of $3,000 t..
Find the amount of capital and labor that will maximize profit. Show second order conditions for the maximum.
Explain how will the economy change over time. Explain in words and using an aggregate-demand/aggregate-supply diagram.
when a cold snap hits florida, the price of orange juice rises in the supermarkets throughout the country. Illustrate the supply and demand table for this scenario.
q1. difference between deflation and disinflation? what is bad about deflation? can you distinguish between anticipated
What additional programs did the Fed create and implement to facilitate its role as leader of last resort? What was the primary purpose of these new programs?
Do you agree or disagree with the statement that: "A monopolist always charges the highest possible price."? Explain. b.) Why can't an individual firm raise its price by reducing output or lower its price to increase sales volume in a purely competit..
Elucidate using a graph why the change in real GDP is likely to be smaller than the shift in the aggregate demand curve.
How it may be possible for increases in the minimum wage to have little impact on employment levels. Please explain using the following concepts: long-run versus short-run; b
The following equations describe a small open economy. Calculate the equilibrium level of output (Y*).
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