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(a) Explain the concept of open market operations (OMOs).
(b) Following on from that, specify which type of OMO is conducted for expansionary monetary
policy, and explain the end result of this to the real economy, including to the level of investment.
You are the chief policymaker at the Reserve Bank of Australia. Economic growth is growing similar to long-term trend. The prime minister of Australia informs you that given a federal election is due in a year, she will significantly increase government spending now. Given (a) your knowledge of Aggregate Supply-Aggregate Demand, (b) fiscal policy and (c) the role of the Reserve Bank of Australia to maintain inflation at between 2-3% on average over the business cycle, what advice would you give her? Justify your answer.
The following statement is false. Correct and justify your response.
A rise in the cash rate will have no impact on consumption.
Which of the following would a small company with limited capital most likely choose as a cost-effective option?
What is the 95% confidence interval for the amount of time spent on personal issues?
Chris raises cows and produces cheese and milk because he enjoys:
Suppose that inverse demand is given by p(Q) = a-bQ, where Q is total quantity supplied in the market. There are two firms in the market, each with a cost function of c(q) = cq. What is the profit function of each firm? Compare the output and price t..
Suppose the economy starts with a capital stock at time t = 0 equal to 1 unit. Write down the values of gross investment, net investment, capital, consumption, and output observed during the subsequent 10 periods. Suppose that at the beginning of som..
They sold 500,000 units (30-day supplies) that year. In 2016, they experimented with lowering the price to $15 per 30-day supply.
What are the implications of the shift from medical care to the focus on overall health conditions?
Illustrate what happens to money supply, interest rates and economy in general if Federal Reserve is a net seller of government bonds.
What is the probability of pulling 3 green cards if the first 2 are replaced? What is the probability of pulling 3 blue cards if the first one is not replaced?
Not too long ago Hurricane Sandy hit the northeast portion of the United States, causing serious and costly damage. Given what you've learned this week, what can we conclude probably happened to the price of portable generators? To the price of food?..
Would such a rule cause the number of such lawsuits to increase or decrease (and why)? What is the impact of such lawsuits on the prices that we are charged.
Suppose two hot dog stands, Al’s & Bob’s, position themselves at different ends of a 100 yard stretch of beach. Assume there are 100 beach goers evenly distributed along the stretch of beach and travel costs are $.1 per yard. If Al charges $1 for his..
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