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Using an aggregate demand and supply diagram, explain how each of the following scenarios affects the equilibrium price level and aggregate output. Consider first the short-run, th
Goods in the circular flow If Y R is total value of all goods going from F R to F H , then total value added from all firms in the F R box is equal to Y R (they don't pu
The Russell 2000 is a market index for small cap stocks - What do these changes in P/E ratios over last year tell you about current valuation in small caps and the different market
Individual A has UA(XA,YA)=lnXA+2YA and has $500. PX=5 and PY =10. (a) Find the optimum. Show that it is indeed the maximum. (b) PX=10. Find the new optimum. (c) Calculate
Desired Aggregate Spending Desired aggregate spending refers to the volume of purchases of the currently produced goods and services that all spending units in the economy wish
can a country have a current account deficit and a capital account deficit at the same time?
Describe the meaning of word -Investment When we use the word investment, we generally mean "gross investment". Essentially, gross investment comprises all finished goods which
Note that it's changes in prices during 2008 that matter for the high real interest rate (time period when your deposit is earning interest). This means that you can never know how
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
explain the stages and various coordination mechanisms involved in policy processes.
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