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What is the Permanent Income Hypothesis? What is the theory's potential relevance for assessing the effects of temporary tax cuts for the purpose of fiscal stimulus?
If you were asked to design a stimulus program for Canada, what policies would you suggest, and what impacts would you expect from them? How would you evaluate the program's impact 12 months later? (Be as detailed and concrete as possible in your answers. Suggest the data you would use in evaluating the program's impact.)
gap between economic theory and business practice
Individual firm and market supply curves The quantities and prices in the supply schedule can be plotted on a graph. Such a graph is called the firm supply curve. A fir
Suppose market demand and supply are given by Qd = 100 – 2P and QS = 5 + 3P. If a price floor of $20 is set, what will be the size of the resulting surplus?
Market demand and consumers surplus Suppose that the market price of a cup of coffee is K£4 but the consumer was willing to pay £9 for the first unit, £8 for the second, £7 fo
Using the same simple macro model we developed in Module 2: a. Show what will happen to national income (GDP) if the administration implements another $100 (billion) stimulus s
Q. Avoiding Surplus and Inadequate Production? Demand forecasting is essential for the new and old organisations. It is somewhat necessary if an organisation is engaged in larg
Two firms are engaged in Bertrand competition. Both firms have a stable marginal cost of €7. Presently, every firm is allocated half the market. There are 10,000 people in the popu
Marginal utility approach The downward sloping nature of the demand curve can be explained by using the law of diminishing marginal utility . For instance, consider a consum
a bus operates two routes,one to harare and another one to johanesburg.the company analyst estimated that the elasticity of demand for joburg is 0.9 while for harare is 2.the compa
a) What do you understand by equilibrium National Income and to what extent is economic growth beneficial to an economy? b) Explain using both diagrams and mathematical tools,
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