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During the third quarter of 1997, Japanese GDP was falling at an annual rate of over 11 percent. Many blamed the big increase in Japan's taxes in the spring of 1997, which was designed to balance the budget. Explain how an increase in taxes with the economy growing slowly could precipitate a recession. Do not skip steps in your answer. If you were head of the Japanese central bank, how would you respond? What impact would your policy have on the level of investment?
Describe how the opportunity cost of controlling malaria changes as more resources are used to reduce the number of malaria cases.
Managerial capitalism is a phrase we hear less today than in the Golden Age. Why do you suppose it has dropped out of fashion? What changes do you think might bring it back?
U(Y, l) = Y^1/2 l^1/2, where Y= income, l= leisure hours, w= wage rate, price of Y =$1, NL is non-wage income and T is the maximum number of hours available. Let ‘t' be the tax rate on the hourly wage rate, so the effective wage rate is w(1-t) = w..
An individual has to choose between investment A and investment B. The individual estimates that the income an dprobability of the income from each investment are as given in the following table Using Excel statistical tools, ca..
Suppose that every additional five percentage points in the investment rate (I/GDP) boost economic growth by one percentage point. Assume also that all investment must be financed with consumer saving. The economy is now assumed to be fully employ..
Design specifications require that the diameter of an automotive axel measure 200 ± 18 mm. The milling process being considered for producing the axel has a standard deviation of 10mm. a. What is the process capability
What reasons would you give for the rather sizable school dropout rates in developing countries? What might be done to lower these rates?. What are the differences between formal and nonformal education? Give some examples of each.
You have a credit card balance of $15,000 which you plan to repayin 4 monthly payments. You plan to use the following repaymentschedule: Month 1 pay interest due Month 2 pay interest due + one-half the original balance
Little Kona is a small coffee company that is considering entering a market dominated by Big Brew. Each company's profit depends on whether Little Kona enters and whether Big Brew sets a high price or a low price
Holiday Fruit Company buys oranges and processes them into gift fruit baskets and fresh juice. The company grades the fruit it buys on a scale from 1 (lowest quality) to 5(highest quality). The following table summarizes Holiday 's current invento..
Suppose a monopolist is able to engage in perfect first-degree price discrimination in a market. It can sell the first unit at a price of 10 euros, the second at a price of 9 euros, the third at a price of 8 euros, the fourth at a price of 7 euros..
(Case Study: Discretionary Fiscal Policy and Presidential Elections) Suppose that fiscal policy changes output faster than it changes the price level. How might such timing play a role in the theory of political business cycles?
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