What happens if the economy is producing a level of output

Assignment Help Microeconomics
Reference no: EM13182693

we know that when an economy starts out at long-run equilibrium and the government cuts taxes, this will result in inflation int he long run. what happens if the economy is producing a level of output below the full employment (long run equilibrium) level and the government cuts taxes?

Reference no: EM13182693

Questions Cloud

State what will the concentration of equilibrium : If a reaction vessel initially contains only CO and NH3 at concentrations of 1.00 M and 2.00 M, respectively, what will the concentration of HCONH2 be at equilibrium?
Explain potassium phosphate and potassium chloride : A mixture contains both potassium phosphate and potassium chloride. What is the percentage of potassium phosphate in this mixture if reaction of 0.401g of this mixture with excess copper (II) chloride yields 0.213g of copper (II) phosphate?
How might this policy be exasperating the recession : According to theory, if you lower interest rates, business investments and consumer purchases of large durable goods are supposed to increase. In return, this is to help pull us out of a recession. However, this policy of extraordinarily low inter..
State what volumes of sulfur dioxide and dihydrogen sulfide : What volumes of sulfur dioxide and dihydrogen sulfide gases are necessary to produce 11.4 L of water vapor? The balanced equation is SO2 + 2 H2S à 3 S + 2 H2O.
What happens if the economy is producing a level of output : we know that when an economy starts out at long-run equilibrium and the government cuts taxes, this will result in inflation int he long run. what happens if the economy is producing a level of output below the full employment (long run equilibriu..
Describe why the form of the equilibrium constant : Explain why the form of the equilibrium constant for a chemical transformation can be predicted from its stoichiometric coefficients whereas
How much should advertising expenditures be changed : Smith has been informed that on April 1st, Delta Co., a producer of a substitute good, will be decreasing the price of its product by 10%. Given a cross elasticity of 2 and the following information answer the following questions. For this proble..
State larger rf value in a soluvent of medum polarity : Based on polarity, which compound do you expect to have a larger Rf value in a soluvent of medum polarity
What will be the prot per ton : How much corn will the industry be willing to supply at a price of $200? What about at a price of $250? What about $300? $350? $400? ii) Use your answers to graph the long-run supply curve for the industry, that is, the quantity of output the indus..

Reviews

Write a Review

 

Microeconomics Questions & Answers

  Money market in equilibrium economy

Suppose that the money market is initially in equilibrium for an economy. Describe with the aid of a diagram how market adjusts to an increase in money supply, an increase in real GDP

  Determine what will the new equilibrium price

Assume the following data describe the gasoline market: Price per gallon $2.00 2.25 2.50 2.75 3.00 3.25 3.50 Quantity Demanded 32 30 29 28 22 21 20 Quantity Supplied 16 20 24 28 32 36 40 (a) What is the equilibrium price?

  Define the pension benefit guaranty corporation

The Pension Benefit Guaranty Corporation (PBGC) is a government agency that absorbs pension obligations when a company goes bankrupt or otherwise cannot fulfill its pension obligations to current or former employees. Where is the moral hazard in ..

  Evaluate the impact of price cut

How much would Wyandotte have to reduce the price of polyol to achieve a 15 percent increase in the quantity sold? Evaluate the impact of such a price cut on(i) total revenue, (ii)total costs, and (iii)total profits.

  Devise a hypothetical business situation

Devise a hypothetical business situation in which buying a lookback call option on a commodity may be a sound strategy for you. How about a down-and-out call option?

  Demand function for daily attendance

Calculate the price that the Plaza Movie House will charge for admission to movies in the long run and what will be the number of patrons per day at that price?

  Effect of increase in wage

The output effect of an increase in the wage comes about because higher wages:

  Business formation codes

Explain the process for obtaining an annual filing report for a corporation currently registered in California

  Consumer surplus-producer surplus-deadweight loss

Compute the equilibrium price and quantity. Describe why the output and price levels are different for X1 and X2. Explain what occurs to consumer surplus, producer surplus, and deadweight loss.

  Calculate the expected value of returns of stock

Using Minitab estimate the expected value of its profits and standard deviation of profits and calculate the expected value of returns of stock A & B

  Explain cost savings and reduction in risks associated

LG electronics plans to invest $30 million by 2010 to make this happen with the hope that the cost savings and reduction in risks associated with vertical integration justify the investment.

  Discuss the implications of your analysis

The particular index that you will compare to the Thumbtack measure is Forbes-overall . You are to include your index along with the five X variables suggested by the authors of the report of the Thumbtack survey.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd