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Question: Analyzing macroeconomic events with the IS curve (I): Consider the following changes in the macroeconomy. Show how to think about them using the IS curve, and explain how and why GDP is affected in the short run.
(a) The Federal Reserve undertakes policy actions that have the effect of lowering the real interest rate below the marginal product of capital. (We will learn how this can occur in Chapter 12.)
(b) Consumers become pessimistic about the state of the economy and future productivity growth.
(c) Improvements in information technology increase productivity and therefore increase the marginal product of capital.
Analyze measures of economic growth, and comparative and absolute advantage in international trade for the following countries:
one possible method of determining a group preference relation is the borda count. the way it works is that each voter
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In response to pressure from environmentalists the government now tightens the maximum damage standard to 4 units. How much fertilizer will farmers use now? What will their profit be? What is the net societal benefit? What is the value of ??
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What is a listing of the various quantities of a particular product supplied at all possible prices in the market.
Considering an economy with a current trade deficit and considering only the direct effect on income, an expansionary monetary policy tends to
Determine the Tragedy of the Commons, which gives a contemporary example, and offer a potential solution.
a local hardware store is trying to decide whether to stay open. they have found that their industry is extremely
How would you explain reservations in the United States about the implementation of NAFTA? Do you think that NAFTA is a good thing or not?
Please answer each of the questions below in short-answer format. Write your responses in complete sentences. Your answers to each question should include 2-3 paragraphs (125-250 words). 1. What shape did the short-run aggregate supply curve have ..
Using the 3-graph model developed in chapter 14, consider first the impact on the demand for loanable funds. If businesses respond as expected to the investment-tax credit, what will happen to the demand for loanable funds Given this, what, if any..
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