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Given the following information: Consumers are very optimistic about the future. The price of oil has just doubled. The money supply is growing at a 6% rate. The government has just cut spending by 8%. Firms are doubling their investment. The trade deficit has doubled in the last 6 months. Calculate the long-run rate of inflation.
One common criticism in the optimal taxation literature is the specification of the social welfare function. The optimal taxation literature (I have the Mirrlees framework in mind) relies on first specifying a social welfare function. what kind of po..
To what degree does real GDP measure to health of an economy? How is it possible to make valid international comparisons of real GDP? Support your answer with examples.
This case analysis should be written on "the economist" case provided in the additional material. Thank you custom-writing! No additional research is needed but any tables or graphs that are needed should go in the appendix with a max of 3 pages as e..
If one compares the contemporary U.S. economy with those of Germany and France, it is reasonable to conclude that
Suppose you can hire your mechanic for up to six hours. The total benefit and total cost functions are B (H)=420H-40H^2 and C(H)=100H+120H^2. The corresponding formulas for marginal benefit and marginal cost are MB (H)=420-80H and MC(H)=100+240H.
Reverse Innovation is the strategy of innovating in emerging (or developing) markets and then selling these innovations in developed markets. Companies are developing products in emerging countries like China and India for global distribution. How wi..
Autonomous aggregate expenditures decreases by $200 million, the marginal propensity to consume is 0.50, marginal propensity to invest is 0.25, and the marginal propensity to import is 0.10. Calculate the change in income.
Whenever the amount of output produced is not as great as the amount that the economy is capable of producing, there is a positive GDP ___________ and cyclical unemployment will be the result.
Tom gains utility from consumption C and leisure L. The most leisure she can consume in any given week is 112 hours. His wage is $20. His utility function is U(C,L) = C^3/4*L^1/4. Tom receives 640 each week from her great-grandmother. What is the mar..
Jaguar Machining needs to purchase a piece of machinery to be able to compete on a new contract with a first-tier automotive supplier. The machinery will cost $140,000 and the owner arranges to borrow the entire amount at 8% interest. By how much ($X..
The reason economists use the midpoint method to compute elasticity is that:
Suppose that initially the price is $20 in a perfectly competitive market. Firms are making zero economic profits. Then the market demand shrinks permanently, some firms leave the industry, and the industry returns to a long-run equilibrium. What wil..
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