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Explain how each of the following affects consumption demand: a) The expectation is that a prolonged expansion will occur in the next year. (2) b) Stock prices rise sharply. (2) c) The price level falls by 10%. (2) d) The interest rate on consumer loans rises sharply. (2) e) Income taxes decrease.
Some countries have fixed exchange rate systems instead of flexible exchange rate systems. Which of the following is a reason why fixed exchange rate systems have limited abilities to use monetary policy?
Name and discuss the four major theories that address the term structure of interest rates. In your discussion, indicate the strengths and weaknesses of each of the theories and which theory or theories appear to be the best accepted as explanations ..
adam smith rejected utility as a foundation for value. he illustrates this rejection in his famous diamonds and water
Illustrate what do they mean efficienty level of output. If the government were to build the bridge, what price should it charge.
If the marginal product curve is increasing from workers 1-89 and then decreases steadily, crossing the horizontal axis at 190 workers, we know that the total output curve increases from workers 1-89, decreases from workers 90-189, and becomes 0 at t..
Critically compare and contrast the policy approaches of TSCA and FIFRA. In your view, which of these is more effective in preventing pollution? Explain.
q.tax cut under fixed as well as flexible exchange rates1 what is the impact of a tax cut in an economy operating under
q. 1. why indifference curves are downward sloping?2. why indifference curves are flatter whenever moving to the
Analyze the effect of both a bad weather and the rumors od a deadly disease in the consumption of rice?
New York & Co. is considering a limited edition denim jacket. Because it is so special, the first few will sell for a very high price, the next for less, and so on. A curve on a graph is used to estimate the price of each jacket. What if a less autom..
Given the data below, use PRESENT WORTH ANALYSIS at a 15% interest rate to decide if method A or method B should be used. Method A: Initial capital cost of $100,000. Operating cost of $20,000 per year. Salvage value after 3 years is $20,000.
Consider an economy where, consumer’s utility function is given as U(C,L)=C-(1/2)L2 . where C is consumption and L is labor. The production technology is Y=(1.6)L-(1/2)L2. The turnover cost per labor is (0.36)/(w/p). What happens to t as real wage in..
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