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Suppose that the desired capital stock is given as: K* = 0.3Y/i r Where Y = GDP, and i r is the real interest rate. Suppose further that Y = $5 trillion and that i r
what is the impact of interest rate in consumption
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
5. In this question you should assume that the Marginal Propensity to Consume out of permanent income is one [i.e., no bequest motive + perfect consumption smoothing: c1, = c2 = c
how to calculate it
suppose that a persons wealth is kshs. 50,000 and her yearly income is kshs. 60,000. suppose further that her money demand function is given by Md = y(0.35-i) where i= interest
Suppose an advertising agency is conducting a survey concerning the effectiveness of commercials during the Super Bowl. If 32% of people watch the Super Bowl, and if the agency con
One constraint in our economy is time. As a society, we make choices about the allocation of time between work and other pursuits. In the US, most workers are eligible for overtime
Q. Show the analysis of cross model? We can divide our analysis of cross model into three sections: Aggregate demand. Aggregate demand is a major component of cross mo
Q. What do you mean by multiplier effect? Loans and deposits in banks give rise to a significant multiplier effect. We use a simple instance to explain this effect. Consider th
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