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A new stadium is built and creates an increase in income of $1.2 million for the city. If the marginal propensity to consume in this city is .95, calculate the total increase in economic activity for the city due to this increase in income (assume the economy of the city is closed).
Suppose that the government has been supporting the price of corn. It's free market price is $2.50 per bushel, but the govt. has been setting a support price of $3.50 per bushel. Which of the following are ways that the government might try to reduce..
Coca-Cola and PepsiCo are the leading competitors in the market for cola products. In 1960 Coca-Cola introduced Sprite, which today is the worldwide leader in the lemon-lime soft drink market and ranks fourth among all soft drinks worldwide. If you w..
If the basket of goods used to calculate the CPI is changed to reflect substitution to lower priced goods by consumers, it would result in:
Consider a copy shop with annualized fixed costs of $1000 and variable cost of $0.03 per page. The shop presently has orders for 100,000 copies at a price of $0.05 per page. What is the shop’s average cost (AC) without taking the new order? Is it les..
What are some examples of events that could shift the demand or supply of labor and why they do so?
Clarify how the caste system does not help people living in poverty in India. Compare to how a class system in America has or has not helped Americans living
St. Joseph's school has 1,200 students, each of whom currently pays $8,000 per year to attend. In addition to revenues from tuition, the school receives an appropriation from the church to sustain its activities. She suggests that another solution mi..
A group of businessmen formed a corporation to lease for 5 years a piece of land at the intersection of two busy streets. The corporation has invested $50,000
Discuss the policy tool(s) the Federal Reserve has been using in the last year or two. What benefits does this tool have? Is it effective in supporting the money supply? If not, what can be done differently?
Suppose that consumption expenditures, investment expenditures, and government purchases are 75 billion, 25 billion and 20 billion, respectively. How large should the GDP be so that the net export is zero?
At the end of the 5th year, High Flyer will sell the distribution center for an estimated amount of $10,000. High Flyer's WACC is 19% and it faces a 30% tax
1. What is the significance of wage and price flexibility in the classical argument that economy is self-correcting?
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