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Explain the term- inventory investment
We would have a negative inventory investment whenever inventories decrease. By net investments we mean gross investments minus depreciation such that actual increase in amount of capital between two periods in time is equal to net investment during this period. Keep in mind that when capital is a stock, investment is a flow. We may talk about a firm's total amount of capital at a certain point in time and a firm's total investment over a period of time.
The AS-AD model with inflation When we remove assumption of constant prices to allow varying real wages. Resulting model was known as AS-AD model. Similarly we now remove the a
This problem revolves around determining the LM curve, as we did earlier in the term such that money demand (M D ) equals money supply (M S ), however in this instance under differ
Explain the difference among a floating and managed exchange rate. The key distinction here is that a floating exchange rate is set by market forces, i.e. supply and demand. A
Because of high production-changeover time and costs, a director of manufacturing must convince management that a proposed manufacturing method reduces costs before the new method
what is credit multiplier?
Equilibrium in both the goods and in the money market If both the goods- and the money markets are to be in equilibrium... ...if P increases, Y must fal
C=Ca+.95(Y-T) Ca=400-20r T=1200 + .4Y (M/P)^d = .35Y - 5r (M^s/P)=2000 Ip=1500-20r G=2200 NX=500-.06Y a. Compute the multiplier b. Derive the equation for Ap c. Derive the equatio
Classify each good as a final good or intermediate good. (briefly explain wach choice) 1. running shoes 2. cotton fibers 3. watches 4. textbooks 5. coal 6. sunscr
critically explain solow model of economic growth
Which of the following will cause property crime to increase? a) An increase in jail terms. b) A decrease in personal incomes. c) An increase in the probability of arrest.
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