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Consider the consumption decisions of R.B. Turbo, a new student at T University. Ms. Turbo has only available $1,000 in monthly income to spend on food and housing. In te
An article published in Die Zeit on 25 March 2010 analyses the German policy that allows for only moderate increases in wages. According to this article, the unit labor costs in Ge
Suppose A can somehow change the game in problem 5.1 to a new one in which his payoff from Up is reduced by 2, producing the following payoff matrix. a. Find the Nash equilibriu
Question 1: Differentiate between income, price and cross elasticities of demand. How will the concept of price elasticity be useful to the owner of a supermarket who wan
Different approaches to measure aggregate output
Q. Explain the problem involved in consumer price Index? To explain the problems involved in calculating CPI we consider MP3 players. If you measure the average price of MP3 pl
Another area where monetarists differ from Keynesians is money supply and interest rates. In the Keynesian analysis with less than full employment level equilibrium, the interest r
Financial and Real Investment Financial investment simply means transfer of right from one party to another. While one party has made investment, the other has made disinvestme
A restaurant/bar is analyzing its pricing of beer. It has determined that the price elasticity of demand for beer is 0.8, the cross-price elasticity for wine with respect to the pr
Q. Relationship between L and P? • As long as L is smaller than LB, L may change with no change in prices. In this range, there is no relation between L andP. • When L is betw
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