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Demand Elasticity : key informaiton
1. A consultant estimates the price-quantity relationship for New World Pizza to beP=50-5Q.
a. At what output rate is demand unitary elastic?
b. Over what range of output is demand elastic?
c. At the current price, 8 units are demanded each period. If the objective is to increase total revenue, should the price be increased or decreased? Explain
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Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.
How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.
Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?
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