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1. If firms suddenly become more optimistic about the profitability of investment and planned investment spending rises by $100 billion, while consumers become more pessimistic and autonomous consumer spending falls by $100 billion, what happens to aggregate output?
2. A rise in planned investment spending by $100 billion at the same time that autonomous consumer expenditure falls by $50 billion has the same effect on aggregate output as a rise in autonomous consumer expenditure alone by $50 billion. Is this statement true, false, or uncertain? Explain your answer.
Suppose the government cuts its purchases by $120 billion. As a result, budget deficit is reduced by $40 billion, private domestic decreases by $10 billion,
Explain why do economists attempting to forecast short run future changes in real GDP and employment look closely at information on business inventories and unfilled orders?
"In the Solow model, an economy that starts with a higher stock of capital per capita will reach a higher steady state level of capital per capita"
Elucidate foreign demand for dollars as well as the international value of the dollar.
When McDonald's Corp. reduced the price of its Big Mac by 75 percent if customers also purchased-Using your knowledge of game theory, what do you thank disrupted McDonald's plans?
economists sometimes use concentration ratios to evaluate whether industries are oligopolies. In this application, you will make your own determination using the most recent data available. You will also discuss the merits and disadvantages of oligop..
Comprehensively distinguish between expansionary and restrictive fiscal policy. Is the current fiscal policy stance in SA expansionary or restrictive? Motivate your answer comprehensively. (half a page with references)
The Congressional Budget Office (CBO) on August 25, 2009 estimated that the accumulated deficit from 2010-19 will approximate $7.137 trillion.
Describe the role of a country"s central bank and the tools that a central bank can use to control the money supply, and explain how a central bank can use monetary tools to implement monetary policy.
Assuming that there is a dominant firm, whose marginal cost is constant at $6. Derive the residual demand curve that it faces. Calculate its profit-maximizing output and price and show just the Output number and Price per unit.
Which of the following goods or services would be most likely to be subject to (1) external economies of scale and (2) dynamic increasing returns? Describe your answers.
If graphed, would the curve for this equation slope upward or slope downward and are the variables C and Y inversely related or directly related?
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