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In 2009, ABC Company made $2M of net profit and spent $100,000 on advertisement. In 2010, it made $2.5M of net profit and spent $150,000 of advertisement. Based on this information, if ABC's advertisement expenditure increases by $20,000 in 2011, how much do you expect its net profit to increase? Explain why the ratios of net profit to advertisement expenditure in 2009 and 2010 are different from the slope of the net profit advertisement relationship.
Determine the Economic functions of money There are three functions of economics of money - A medium of exchange. - A unit of account - Store of value.
Q. How to evaluate total savings? Total savings Total savings S(r) depends positively on the real interest rate Remember that total saving
America can produce 100 shirts or 20 computers and China can produce 100 shirts or 10 computers. With trade, who exports shirts? Which country benefits from the trade?
Explain the multiplier effect with example Deposits and loans in banks give rise to an important multiplier effect. We use a simple example to illustrate this effect. Consider
How can an economy achieve mutual gain from International Trade?
An ecologist is interested in the possible negative effects of marinas and boat mooring areas on the abundances of fish. Having read Hurlbert's paper about pseudoreplication, he de
it has been argued that economic development of developing countries has been held back by a persistent fall in the terms of trade of developing countries over the long run
Question : The long-run position of an economy is described by the quantity theory of money: M/P = L (Y, r) Where M: nominal money stock; P: price level; Y: real income a
Q. Show the Destruction of capital? Destruction of capital, for instance, through a war, works in the opposite way. Marginal product of labor falls, GDP per capita falls and po
what is the relevance of the lewis model
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