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Question: The costs of inflation: Consider two possible inflation scenarios. In one, the inflation rate is 100% per year, but it has been at this level for three decades and the central bank says it will keep it there forever. In the other, the inflation rate was 3% for two decades but just this past year rose to 10%. Over the next 5 years, which economy do you think suffers a higher cost of inflation, and why?
Describe as way someone could use the concept of opportunity costs - What is diminishing marginal utility and how does it relate in someone personal life.
Using necessary and sufficient condition explain consumer surplus diagrammically and mathematically?
A pure monopolist determines that at the current level of output the marginal cost of production is $2, average variable costs are $2.75, and average total costs are $2.95
At its current short-run level of production, a firm's average variable costs equal $15 per unit, and its average fixed costs equal $25 per unit. It's total costs at this production level equal $800.
Again, assume that prices and wages in the economy adjust quickly so that all the markets in the economy are always in equilibrium. Suppose government expenditure increases. What is the impact of this shock on P (hint. Use the equation you solved ..
What type of compensation policy would you expect to observe in an industry with rapidly changing technology? Explain. Suppose you are the owner-operator of a gas station in a small town. Over the past 20 years, you and your rival successfully kept p..
What is the marginal opportunity cost to the corporation of an executive's personal flight? What factors (such as fuel) determine the mar-ginal explicit cost to a corporation of an execu-tive's personal flight?
what is the impact of free trade on domestic job creation policy? elaborate with examples. what the impacts of
Use the demand and supply analysis to explain how higher price of corn impact the market for Ethanol (a motor fuel manufactured from corn and can be used to power the engines of many Automobiles).
The money supply and money demand functions of an economy are as follows: Money supply: (M/P)s and Money demand: (M/P)d = L (i, Y) = 0.2Y/0.5i. What is the velocity of money in this economy
Compare and contrast direct finance and indirect finance.
What are the benefits of strong dollar for the US? What are the costs? The dominance of the dollar can lead to a dilemma for policymakers?
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