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1. What is the "velocity of money"? Why is it important to the macro-economy?
2. Why would some households with increases in "household wealth" continue to consume at their prior household level even given household wealth increases? How would this be related to the velocity of money?
3. Why is U.S. Government spending crucial to the creation of higher "new equilibrium levels"? Is this good for the macro-economy? Explain why or why not.
Answers must be 1 page each.
Use the aggregate demand-aggregate supply model to illustrate graphically the short-run and long-run impact of this decline on output and prices.
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Joe Donaldson deposited $80,000 in his new business. Prepare all entries related to above transactions.
Suppose you are a central planner in a communist country, and it is your job to set the price of rutabagas. The first person assigned to this job set a price of 10. This resulted in 40 tons of rutabagas supplied and 75 tons of rutabagas demanded.
Suppose government increases autonomous taxes and defence expenditure by the same amount. Will real GDP increase in the short run? Why?
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Economic indicators are economic statistics that tell us how well the economy is doing. The GDP, unemployment value, and inflation vale are the most common macroeconomic indicators.
Suppose demand function has changed t0o Qd2 = 14-P. What is the new equilibrium price and quantity. Show your work
1. what percentage of the gross national product is spent on healthcare in the u.s.? 2. identify the key drivers of
Elucidate what would have been the economic effects of this. Describe the pros and cons.
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