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Consider a market for online movie rentals. The market supply curve slopes upward, the market demand curve slopes downward, and the equilibrium rental price equals $3.50. Consider each of the following events, and discuss the effects they will have on the market clearing price and on the demand curve faced by the individual online rental firm.
a. People's tastes change in favor of going to see more movies at cinemas with their friends and family members.
b. More online movie-rental firms enter the market.
c. There is a significant increase in the price to consumers of purchasing movies online.
If money demand for speculative purpose is$ 5000 and money demanded for transaction motive is $ 40 000. if money demanded for speculative purpose increases by $ 5000, what is the new total demand for money using Keynesian Theory of Money Demand.
Why does the aggregate demand curve slope downward?Give at least three reasons and examples when addressing thisquestion. Identify an event that would shift the AD curve and whichdirection the AD curve will shift.
What was the growth rate for nominal GDP in 2007? What was the growth rate for real GDP in 2007? What was the inflation rate in 2007? What was the growth rate of real GDP per capita
The marginal propensity to consume and the marginal income tax rate are 0.9 and 1/3, respectively. The budget deficit is observed to increase by 90. a. What change in investment would account for this b. What change in government spending would acc..
Suppose the French suddenly develop a strong taste for California wines. Answer the Following with words and a Diagram: a. What happens to the demand for dollars in the market for foreign-currency exchange
What is the relationship between potential output and the natural rate of unemployment If the economy currently has a frictional unemployment rate of 2 percent, structural unemployment of 2 percent, seasonal unemployment of 0.5 percent.
f she feels that the fist pound of potatoes is worth $1.50, the second pound is worth $1.14, the third pound is worth $1.05, and all the subsequent pounds are worth $0.30, how many pounds of potatoes will she purchase?
What measures and tools does Federal Reserve have at its disposal to address economy. What has the Fed employed in the past two years to help economy?
Short term Treasury bills [3 and 6 month] have current annual rates of interest around 0.5%. Use that info plus your best forecast of inflation to calculate the real rate of interest on those bills.
Treat savings as a fixed expense - Automate, Direct Deposit, Payroll deductions Fixed expense strategy can help generate additional savings contributing to further growth in new worth (Dollar Cost Averaging)
Why do you think the FED evaluates the money multiplier when making decisions with regard to the money supply What function does the money supply serve in our economy to influence certain economic variables
If our country (US) can make everything better and cheaper than foreigners, why would we have any reason to be involved in international trade?
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