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The following information describes a hypothetical economy (assume all numbers are in billion if necessary)
C = 100 + 0.75 DI
Ig = 850
G =950
Xn = -100
Determine the value of the MPC of this economy?
Changes in government spending and interest rates
The socio-economic shortcomings that China experienced
For a perfectly competitive firm the price is $2 per unit. At this price the firm is producing and selling 10,000 units. It costs $1.50 to produce the last unit. Should the firm produce more? Less? Why?
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When a recession is over, do people begin to immediately feel the effects of an efficient economy? Use the experience of the most recent recession to justify your answer.
The airline has an average of 40 passengers paying an average of $200 for this flight. Do you think the airline should be flying between the two cities? Evaluate from a short-run and long-run perspective.
Suppose that the economy is short of its full-employment (potential) level of GDP, assumed to be $14,000 billion, by $500 billion.
Suppose that American households change their tastes such that they want to save more at every level of income.
The table below is a production possibility table for the fictional country of Myopia. Use it to construct the corresponding production possibility curve.
Determine the profit-maximizing prices both firms will charge. In addition, calculate the price-cost margin for each firm and indicate which has more pricing power and why.
Calculate the expected level of demand in a typical market. Indicate the range within which actual demand is expected to fall with 95% confidence.
What were some of causes of stagflation of 1973 and 1979? In what ways were these episodes of stagflation different from great depression of the 1930s?
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