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1. Suppose that the Federal Reserve is worried about inflation. Explain the likely way that the Fed would respond to this concern.
a. Describe the tool(s) it would use to counter this concern. Be sure to offer detail to your description.
b. Explain the effect/direction (in the short run) their policy decision would have on
i. interest rates
ii. aggregate demand
iii. output
iv. unemployment
v. investment
vi. exchange rates
vii. international financial capital flows
c. Draw the 1) AD/AS, 2) loanable funds, and 3) exchange rate models to support your answers
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Suppose the demand for a product is given by P = 50 –Q. Also, the supply is given by P = 10 + 3Q. If a $12 per-unit excise tax is levied on the buyers of a good, consumer surplus is equal to
It is generally claimed that a movement from “autarky” to free trade consistent with Ricardian comparative advantage increases the economic welfare of each of the trade partners. However, it may be demonstrated that under certain circumstances, not e..
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You are a business blog contributor for an online marketing support website. Discuss why these three tips are important for new entrepreneurs.
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