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Contractionary Fiscal Policy
1. What is a contractionary fiscal policy? When would an economy ever pursue a contractionary fiscal policy? Can you find any examples for when this policy was used in our economy and why?
Agree or disagree and describe: In monopolistically competitive market, firms that innovate successfully can increase their economic profits and lock in higher market shares over long run.
Suppose a product sold in a competitive market is subject to a government price control. Suppose the regulated price is less than the free market equilibrium price.
A perfect competitive firm has the cost function TC = 1000 + 2Q + 0.1 Q^2-What is the lowest price at which the firm can break even?
High Mark Industries sells solar water heaters to households interested in lower energy bills and sustainable energy.
Suppose you own a home remodelling company. You are currently earning short-run profits. The home remodelling industry is an increasing-cost industry. In the long run, what do you expect will happen to
For each of the following events, state whether the aggregate demand curve would increase, decrease, or stay the same.
A firm uses a single plan with costs C = 160 + 16Q + .1Q 2 and faces the price equation P = 96 - .4Q. The firm's production manager claims that the firm's average cost of production is minimized at an output of 40 units.
As a manager of chain of movie theatres which are monopolies in their respective markets-Devise a pricing strategy to maximize your firm's profits.
For an unknown reason, aliens kidnapped all immigrants residing in the US. One morning America wakes up and finds that the only people left in the country are American citizens, while all legal and illegal immigrants are gone.
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?
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..
Is energy efficiency the same as economic efficiency? Explain. Under what circumstances would the energy-efficiency automobile described her be economic efficient?
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