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Graphically, the downward -sloping is curve shows an inverse relationship between income (Y) and the "the" interest rate (i), while the upward-sloping LM curve shows a direct relationship between these two variables. Explain why these curves have these slopes, what their point of intersection means, and show how expansionary fiscal and monetary policies work. Under what conditions would these policies work more, or less, effectively?
Explain how a change in investment can have big impact on GDp causing nationwide slump. Recall that investment is "small' relative to the whole economy.
Assume you hire a furloughed Wall Street analyst to aid you examine your production process, and she uses your historical cost records to estimate that your total cost function is C(Q) = 100 + 2Q + 3.5Q2. Using this equation, answer the following ..
In the country A, all wage contracts are indexed to inflation. That is, each month wages are adjusted to reflect increases in cost of living as reflected in changes in price level. Explain answer with aggregate supply and aggregate demand curves.
Assuming no population growth or technological progress, find the steady state capital stock per worker, output per worker, consumption per worker and investment per worker given that the rate of saving is 20% and depreciation rate is 10%.
Discuss the use of Gross Domestic Policy (GDP) to measure the business cycle. Discuss the roles of government bodies which determine national fiscal policies.
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?
Find the velocity given that the market is in equilibrium. MD1 is the relevant curve and it is given that the real GDP is 30,000.
Macroeconomics questions, discuss the short-run and long-run effects, Keynesian model, Distinguish between ongoing demand pull and ongoing cost push inflation.
Robin and Terry are Stranded on a deserted island and consume two products, coconuts and fish. In a day, Robin can catch 2 fishes or gather 8 coconuts, and Terry can catch 1 fish or gather 1 coconut.
Assume that Congress is considering imposing the 30% tariff on imported automobiles. Who would be the gainers and who would be the losers from such move?
Suppose that workers and firms could always predict next year\'s price level with perfect accuracy.
Answer whether the following statements are true or false, explaining your answer in each case.
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