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A nation will gain from trade if it:
A) produces and consumes along its PPF.
B) produces outside its PPF and consumes along its PPF.
C) consumes outside its PPF and produces along its PPF.
D) produces and consumes outside its PPF.
A Big Mac costs $5 in the U.S. and 7 euros in Germany. If the exchange rate is 0.6 Euros per dollar, is the dollar undervalued or overvalued against the Euro? What would you expect to happen in the currency market? What objection do you have to using..
Do you think that there is a “retirement problem” in the US, meaning that individuals and families are not saving enough for retirement? What three original pieces of evidence support your observations and conclusions (journal articles, studies, spec..
In a situation of first-mover advantage, a strategic move would be to:
Suppose Congress passes legislation that raises taxes. At the same time the Fed undertakes contractionary monetary policy. Use the IS-LM model to illustrate graphically the impact on output and interest rates. Explain the graph in words, specifically..
The Depository Institutions Deregulation and Monetary Control Act of 1980 did not. Stored value and smart cards are forms of electronic banking. Raising the reserve requirement or the discount rate always decreases the money supply.
Demand for microprocessors is given by P=35 - 5Q where Qis quantity of microchips in millions. The typical firm’s total cost of producing a chip is Ci=5qi where qi is the output of firm i. Suppose that one company acquires all the suppliers in the in..
Ilustrate what is the market price and level of each firm's output in the short run. How much profit does each firm make.
The principal benefit of tariff protection goes to: A ad valorem tariff provides domestic producers a declining degree of protection against import-competing goods during periods of changing prices. When the production of a commodity does not utilize..
Illustrate what is the cooperative surplus. $100, the cost of litigating. What would be a reasonable settlement for Betty to pay What Arthur.
Y at PPP is only 0.05. It is well-known that investment rate dierenHSL39502.bmpe when measured at a common set of prices while very small when measured at domestic prices.
The demand function for a firm’s product is Q = P-3. The firm’s marginal cost of production is constant at MC(Q) = 12. (a) Calculate the elasticity of demand, as a function of Q. what is the firm’s profit-maximizing price? what is the firm’s profit-m..
Imagine that you are a lobbyist for timber, an established industry suffering from low-priced foreign competition, and you are trying to get Congress to pass trade restrictions. Which two or three of the five arguments do you think would be most pers..
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