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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. If autonomous exports have just fallen by $20, what will happen to equilibrium income? What about unemployment? Show the adjustment process to the new equilibrium using a graph.
using a classical labour market , illustrate the effects of a real wage existing in the market that is lower than the equilibrium real wage. what will eventually happen in this lab
Q. Explain about Household savings? Remember that consumption may refer to observed consumption as well as to demand for consumption. The same is true for 'household savings',
State the Monetary base and the supply of money - central bank It is not possible for the central bank to print and distribute money - that would increase their debt without i
If there are economies of scope and if the price for each product equals marginal cost, is it possible for a firm to cover all its costs? If the firm's average cost of production d
"The price of Brent crude oil has hit $111 a barrel and US crude also rose in price, as worries persist about the unrest in Libya". (BBC News, 2011) This quote, from the BBC news w
Imagine a firm with the same cost structure but in each of the four market structures: Competitive, Monopolistically Competitive, Oligopoly, and a Monopoly. Using the concepts of c
Definition of Money We should define what we mean by money. Money has a long as well as interesting history and an understanding of how we came to use money is useful for any
In order to observe the correlations between each variable, the most effective method to use is Vector Autoregression (VAR). VAR estimation uses a system of simultaneous equations
Components of Balance of Payments The BoP statement is usually divided into three major groups of accounts. These are: i.The Current Account: This account records the imp
Consider following 5,000 value securities. Bond Coupon Rate Selling price coupon payment yield to maturity% 6% $5000 6% $5500 10% $5000 12% $4500 A. Are those securities abov
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