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Suppose you buy call options on Microsoft stock. Each option costs $2 and has the strike price of $40 and the expiration date July 1. Discuss whether you would exercise the options in each of following situations.
a. It is March 1, and Microsoft stock price is $30.
b. It is March 1, and the stock price is $40.10
c. It is March 1, and the stock price is $50
d. It is June 30, and the stock price is $50.
Consider the impact of an increase in thriftiness in the Keynesian-cross analysis. Assume that the marginal propensity to consume is unchanged, but the intercept of the consumption
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Q. How to evaluate total savings? Total savings Total savings S(r) depends positively on the real interest rate Remember that total saving
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Stocks and Flows When studying economics, one must be sure whether the variable being studied is a stock variable or a flow variable. Failure to do so can cause faulty economi
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