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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 the bank K-bank with total deposits of 10,000 (millions or whatever). K-bank is aiming for a reserve ratio of 10% of deposits. At the instance it has lent 9,000 and has 1,000 in reserve - exactly meeting their desired reserve ratio.
Suppose the economy is currently in recession, and the exchange rate if fixed using the IS-LM model. a) Explain and illustrate the economy adjustment (in the medium run) b) E
Y= C+I+G C= 100,000000+ 0.4yd I= 400,00000 T= 0.2+60m G= 750, 000000 Calculate equilibrium level of income
The opportunity costs associated with the use of resources owned by a firm are: a. externalities b. implicit costs c. explicit costs d. sunk costs
Consider the utility function u(x1, x2) = x1x2. (a) Graph the indifference curves for utility levels 1 and 2. (They are symmetric hyperbolas Asymptotic to both axes). (b) Graph the
Description of Inflation in detail Inflation is the rate at which average price level of services and goods rises in a given time period. In UK the Office for National Statist
An investment promised a payoff of $195 two and a half years from today. At a discount rate of 75% per year what is the present value of this investment? A. 169.47 B. Not enoug
link of monetary account with other sectors and its meaning
Q. Define the Prices and price level? Prices are of great significance in macroeconomics as undeniably they are in microeconomics. Though in microeconomics we are more interest
If the reserve bank wants to pursue a contractionary policy, what should it do?
Compare the three investments below in terms of their riskiness. What is the best way to evaluate the riskiness of an investment given the information you have on them? Project Exp
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