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Take a look at the sugar market: US demand: Q=60-2/3 P US domestic supply: Q=P Also, the US could import any quantity from world producers at (US$) 10/cents per lb
a) In a scenario with free trade- what would be equilibrium price in US, also what would be consumer surplus and producer surplus?
b) Assume FDA changes its mind and opens her US to sugar imports; however the government wants to promote domestic sugar production by giving a subsidy of 15 cents/lb
What would be new equilibrium price and quantity?
How much is domestic produced and how much is imported?
What is new consumer surplus and producer surplus?
What is deadweight loss compared to the scenario in question a)?
Suppose the Bank of Canada announces that it will raise the money supply in the future but does not change the money supply today. Using the Fisher equation, explain what happens t
y=c+c1(y-t0-t1y,r)+i+g
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Calculating interest rates on a yearly basis If maturity is different from one year, interest rate is generally recalculated to a corresponding one year rate. For instance con
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Consider the multiplier model we have studied in class. Assume that the economy is initially in equilibrium and that real income is $180. The marginal propensity to expend is 0.66.
The primary functions of economists are to teach, contribute research and empirical findings and formulate policies. Most of the professional economists are associated with academi
Q. Demand for money for AS-AD model? The money market The demand for money depends negatively on R,positively on Y and positively on P in AS-AD model
Say that the equilibrium price and quantity both rose. What would you say was the most likely cause? There was _____(increase, decrease, no change) in demand and ________(increase,
In multiple regression analysis, before testing the significance of the individual regression coefficients, (a) the intercept must equal 0. (b) the multiple standard error of the e
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