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How can the expectation of a recession lead to a recession?
When people expect recession, they fear spending and thus resulting in reduced investment and declining aggregate demand (AD).This is because reduced spending implies the firms which invested are suffering losses and may quit the business. The level of employment would then soar as investments decline thus resulting in recession.
Regarding question four, why would a little inflation in an economy be viewed as a good thing vs. deflation?
a) Does this situation correspond to short-run equilibrium? Why or why not? b) Does this situation correspond to long-run equilibrium? Why or why not? Draw a graph to support your answer.
What is a pet trust? What is a pet protection agreement? Why does a will not work well as an estate planning tool for ensuring the continuing care of your pets?
Compute the changes in inflation rates, unemployment rates and the RGDP growth rates.
Suppose a monopolist can purchase Labor at a price w = 27 and can purchase Capital at a price r = 3. The monopolist’s production function is given by Q = L1/2K1/2. The demand facing the monopolist is given by P = 402 – 6Q.
The fixed cost is zero for both firms. The two firms want to merge. They argue for the merger on the grounds that marginal production costs would fall to 10 for all units of output after the merger since all production woul be at the low marginal ..
Suppose that the software market currently has only one firm operating - microhard. A new firm Newvell could enter the industry.
Analyze the implications of the income inequality in the US and if this a problem that US should focus on. Evaluate the growing trade deficit on the US economy.
Suppose Donald is expecting an inheritance that will pay him $85,000 at the end of each year for the next 40 years. Since his inheritance is guaranteed money.
Assume a merger of company would simultaneously lessen competition and reduce unit costs through economies of scale.
Summarize the November 1-2 FOMC meeting. What did they directly or indirectly imply? What recommendations did they make? Do you agree with the recommendations? Why or why not?
In this exercise you will study health insurance, health status, and employment using a random sample of more than 8000 workers in the United States surveyed in 1996.
Explain the concept of externality. What does it have to do with the efficient allocation of resources?
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