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8. (a.) Reserve requirement for banks is set at 5%. Your firm withdraws $42,000 on its line of credit at the Security Bank to purchase equipment for expansion. The equipment vendor deposits the amount that he receives from you at his bank, The Highland Bank. By how much has each bank's excess reserves changed as a result of your withdrawal and expenditure? (10 points) What is the maximum amount of new money that can be created in the banking system as a result of your purchase? Show all work. (b.) Suppose that the Security Bank discovers its reserves will temporarily fall slightly short of those legally required. How might it remedy this situation through the Federal Funds market? Explain how the Fed manipulates the Federal Funds Rate in order to achieve macroeconomic objectives. 7. (TCO G and H) (a.)Suppose your local Congress representative suggests that the federal government intervenes in the gasoline market to stop runaway price increases. Would you say that this view basically supports the Keynesian or the Monetarist school of thought? Why? What position would the opposing school of thought take on this issue? (Be brief-you can answer this in 2 or 3 brief paragraphs). (b.) Any change in the economy's total expenditures would be expected to translate into a change in GDP that was larger than the initial change in spending. This phenomenon is known as the multiplier effect. Explain how the multiplier effect works. (c.) You are told that 90 cents out of every extra dollar pumped into the economy goes toward consumption (as opposed to saving). Estimate the GDP impact of a positive change in government spending that equals $20 billion. 6. (TCO F) (a.) Suppose nominal GDP in 1999 was $200 billion, and in 2001, it was $270 billion. The general price index in 1999 was 100 and in 2001 it was 150. Between 1999 and 2001, the real GDP rose by what percent? (b.) Use the following scenario to answer questions (b1) and (b2). In a given year in the United States, the total number of residents is 270 million, the number of residents under the age of 16 is 38 million, the number of institutionalized adults is 15 million, the number of adults who are not looking for work is 17 million, and the number of unemployed is 10 million. (b1.) Refer to the data in the above scenario. What is the size of the labor force in the United States for the given year? (b2.) Refer to the data in the above scenario. What is the unemployment rate in the United States for the given year? 5. (TCO D) A software producer has fixed costs of $30,000 per month and her Total Variable Costs (TVC) as a function of output Q are given below: Q TVC Price 3,000 $ 5,000 $5 13,000 25,000 4 23,000 50,000 3 33,000 80,000 2 43,000 120,000 1 (a.) If software can only be produced in the quantities above, what should be the production level if the producer operates in a monopolistic competitive market where the price of software at each possible quantity is also listed above? Why? (Show all work.) (b.)What should be the production level if fixed costs rose to $50,000 per month? Explain.
complete this essay in a microsoft word document with a minimum of 250 words apa formattedin what respects are the
Current Values and Ethics Article
over the past 12 months the four winds novelty company firm has recorded its internet sales equals monthly output
Developing a brief summary of endogenous and exogenous growth theories.
Explain the process of revenue at NSU, focusing on the relationship between the increased revenue from students enrolling at NSU despite the higher tuition and the lost revenue from possible lower enrollment.
The cranberry market is perfectly competitive. Reports that consuming cranberries can lead to improved health result in a permanent increase in the demand for cranberries and an immediate upward jump in the price of cranberries.
Graph shows number of workers along the horizontal axis and wages along the vertical axis. Coordinates are plotted to indicate a downward-sloping diagonal line
in november 1990 chrysler corporation announced plans to initiate three-shift or nearly continuous 21-hours-per-day
a number of strategies have been put in place to reduce alcohol-related harm by reducing the average consumption of
The data contained in the following table shows the tradeoffs that occur in an economy that produces only two types of products: pharmaceutical and computer-related technological products. Use the data given in the table to graph the production po..
The market demand function of a company is given by 8P + Q - 64 = 0, and the company's average cost function takes the form AC = 8/Q + 6 - 0.4Q + 0.08Q2.
An example of informal writing?
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