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True or false?
1. At any point to the right of the IS curve, total leakages must exceed total injections.
2. If velocity is rising, then the demand for money must be falling.
3. The transactions motive for holding/demanding money is related primarily to the fact that money serves as a store of value.
4. The asset (liquidity preference, or speculative) motive/demand for money relates primarily to money’s medium of exchange function.
5. A Keynesian would view expansionary monetary policy as having its impact primarily through its effect on interest rates and thus consumption.
How should the federal reserve react if they desire to bring inflation down to 3% Wren will they achieve that goal? (Hint: maintain plenty of decimal places.)
What would peso/dollar exchange rate be if purchasing power parity holds. If a monetary expansion caused all prices in Mexico to double.
Discuss which Explain how drop in the export sales sets in an ongoing recession using accelerator model.
Suppose you own a home remodeling company. You are currently earning short-run profits. The home remodeling industry is an increasing-cost industry.
a researcher reported that he had found the demand curve for kerosene to be upward sloping.-as the price of kerosene rose the quantity demanded of kerosene increased. Illustrate what questions might you have for this researcher.
The government wants to stimulate the economy. By how much will aggregate demand at current prices shift initially before multiplier effects.
Suppose the value of technology adoption to a given user is log(n) where n is the total number of users who have already adopted the technology. Suppose the cost of technology adoption per user is c. Assume there are N users in the market.
Marge opens an oxygen bar in a building she owns. She utilized to rent the building to her brother in law.
Illustrate what is the maximum amount your firm should be willing to spend on lobbying efforts to prevent the cost from being regulated at the socially optimal level.
Since under price leadership by the dominant firm, the firms in the industry following the leader behave as perfect competitors or price takers by always producing where the price set by the leader equals the sum of their marginal cost curves.
Under very high rates of inflation, why would people prefer to use a barter system to buy goods, rather than use paper money.
In the ‘Classico’ Region within Tuscany, all producers of Chianti wine must submit their wines to a government inspection process which certifies that only grapes grown in the Classic region have been used in the wine. All wines which pass this test ..
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