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Suppose that people's expectations of inflation are subject to random shocks. That is, instead of being merely adaptive, expected inflation in period t, as seen in period t - 1, is Et-1(πt) = πt-1 + ηt-1, where ηt-1 is a random shock. This shock is normally zero, but it deviates from zero when some event beyond past inflation causes expected inflation to change. Similarly, Et(πt+1) = πt + ηt . Derive both the DAD and the DAS equations in this slightly more general model
Elucidate how the enterprise zones could be utilized to enhance the economic development implications of your policy issue.
Explain how regular and lasting were the past trends. What are the chances of these patterns are changing. How accurate is the historical date that we use in time series.
Suppose you are given the following information for an economy without government spending, exports, or imports. C is desired consumption
Compute the elasticity of demand for every parameter.
compared to the gini coefficient for income distribution the value of the gini coefficient for the distribution of
Compare and contrast the effect of an increase in Foreign interest rates on Home's economy under fixed and floating exchange rate regimes. Use the IS-LM-FX model for each case (flexible and fixed exchange rates)2)Why might a country with a fixed ex..
suppose prices are determined as a simple mark-up over expected wages p-wea0-a1uassume further that wages are a simple
suppose in the solow growth model that s.25 n.02 d.08 and fk k3asuppose that z2. what is the steady state level of
Suppose a company where production depends on two inputs: labor and capital, with prices w and r, respectively. Initially, the company faces market values of w=6 and r=4.
The demand for coffee is assumed to be P = 15 - Q (units don't matter here.) The domestic supply of coffee is P = 2 * Q. The world market price of coffee is 5. Using graphs, show who gains and who loses and by how much (both for losers and winners..
To decrease the federal deficit, government would have to cut back on government buy, transfer payments, or increase taxes. How does the federal deficit affect GDP and multiplier?
What are some potential problems with excessive federal debt? How can the debt be managed or repaid?
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