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1) Explain what effect an expansionary fiscal policy would have on the price level and real GDP starting from full employment equilibrium.
2) Why does a larger government budget deficit increase the magnitude of the crowding-out effect?
3) How does the multiplier work and what might government use it for?
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?
The rising stock market implies an increase in wealth, at least as measured on paper. If we assume that some of this increased wealth gets consumed, then the rising stock market fuels an increase in aggregate demand, and may contribute to an inflatio..
A profit-maximizing monopolist never produces in the inelastic part of a linear demand curve. The short-run supply curve of a competitive firm is its MC curve.
Describe what effect a contractionary fiscal policy would've on the price level and real GDP starting from full employment equilibrium.
Assume that the soft coal industry is a competitive industry and it is in long run equilibrium. Now assume that the firms in the industry form a cartel.
What is Bill's opportunity cost of producing one hat, In which of the two activities does Mary have a comparative advantage.
In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?
Which of the following strategies are used by businesses to capture consumer surplus? Nash equilibria are stable because
The public tends to view trade deficits with alarm while macoreconomics claims that trade deficits can actually be usefull for the economy. Discuss the macroeconomists position on trade defilicts
Evaluate the range of marginal revenues
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.
Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."
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