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Economics
This post should be in RESPONSE TO THE FOLLOWING QUESTIONS and must be 250 words. USE OF PEER- REVIEWED SOURCES IS A MUST FROM THE BETHELUNIVERSITY DATABASE BUT IN YOUR OWN WORDS, NO DIRECT QUOTES.
Discuss
The purpose of government subsidies is to encourage activities that are deemed to have positive spillovers. A professional sports team, for example, is thought to increase tax revenues and increased demand for local businesses.
Choose to discuss another good or service for which government provides a subsidy. Include each of the following in your initial post.
1. Describe the subsidy program and explain what spillovers are generated from the subsidy.
2. Explain how both consumer and producer surplus will be affected by the subsidy. Will they increase or decrease?
3. Who are the winners (i.e. increased surplus) and losers (loss of surplus) that result from the subsidy? Remember that there are always trade-offs, and therefore, someone must be the loser.
Why might it be difficult for the Fed to formally adopt inflation targeting? Would inflation targeting be a good policy for the Fed in the present economic environment
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?
Describe the present economic crisis situation in Europe. Why has it been so difficult for the Europeans to find a solution to this problem? Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..
Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.
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Problem based on Utility Function - Problem, Answer and explain the following using a diagram which is completely labeled.
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Problem - Income Elasticity of Demand, Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5
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."
Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.
How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.
Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?
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