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Consider a hypothetical ABC economy in which the narrowly-defined measure of the money supply (M1), as defined in the Canadian sense, in existence is 1250$ million. Assuming the economy's banking system behavior may be characterized by the following simple broad money-multiplier model in which all the variables are as defined in class:
MB= C+RR+ER (equilibrium condition)
C=0.25D (currency holdings of the non-bank public)
RR=RRd+RRt
RRd=0.05D (required reserves against demand deposits)
RRt=0.02T (required reserves against term deposits)
T=0.8D (definition of term deposits)
ER=ERd+ERt
ERd=0.002D (ratio of excess reserves to demand deposits)
ERt=0.001T (ratio of excess reserves to term deposits)
Explain welfare grants and subsidies
i) Two firms, A and B, are operating in a UK textile industry under duopolistic condition and choose to either produce at "High" price or a "Low" price. Suppose you are the man
1. Econ 415 Project Select one time series of real data. The series can be selected from the published data ( http://research.stlouisfed.org/fred2/). The data series must co
Tax Policy Implementation: Take, e.g., the case of tax policy. It attempted to raise resources by a combination of direct and indirect taxes to finance a large part of increa
The government has undertaken a highway bridge project that was originally projected to cost $2 million and provide benefits of $2.5 million. Unfortunately, the costs have been mu
Monica consumes only goods A and B. Suppose that her marginal uility from consuming good A is equal to 1/Qa, and her marginal utility from consuming good B is 1/Qb. If the price of
politicians are often heard saying that tuition at state universities should be kept low to make equation equally accessible to all residents of the state, regardless of income
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what is walrasion equilbrium
Suppose an economy has four sectors, Agriculture (A), Energy (E), Manufacturing (M), and Transportation (T). Sector A sells 10% of its output to E and 25% to M and retains the rest
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