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The Situation: Full employment income is estimated to be $11,000. The current interest rate is estimated to be 4.178 recent. While last year total business investment spending was $900; the rising price of oil has caused expectations to deteriorate (see diagrammatic estimate). The year's federal budget is G=2000 and T=1000. The consumption function is estimated to be: C=500 + 0.75.YD. The Problem: Design and present, using narrative and equations, a fiscal policy sufficient to produce full employment and stable prices.
Use diagram to describe how each of the following events affects the equilibrium price and quantity of pizza (draw a separate diagram for each event)
The demand function for VCRs has been estimated to be Qv = 123 - 1.7Pt + 46 Pm - 2.1Pv -5M, where Qv is the quantity of VCRs,Pt is the price of a videocassette, pmis the price of a movie, Pv is the price of a VCR, and M is income.
Discuss how each of the following developments would affect the supply of the money, the demand for money, and the interest rate. For each case, describe what happens in closed economy and in small open economy. Describe your answers with diagrams.
Answer the following questions as these general questions pertain to the specific issue selected.The questions that you will cover with respect to your choice of broad social issue in the paper are given.
In the 1970s people had become accustomed to high inflation. In 1979, Bank of Canada decided to fight inflation and decreased the money supply growth rates.
Karen earns $75,000 in the current period and will earn $75,000 in the future. Assuming that these are the only two periods, and that banks in her country borrow and lend at an interest rate r = 0, draw her inter-temporal budget constraint.
Write down the relationship between savings, capital formation, and consumption.
The nation is divided into __12______ Federal Reserve districts, each having a Federal Reserve Bank.
Explain which of the following transactions would be directly counted in 2007's GDP. In each case, explain whether the action causes an increase in Consumption, Investment, Govt. Purchases or Net Export.
Estimate the linear trend in the data, and use it to forecast gasoline sales in the United States in each quarter of 1990.
Pam, having recently graduated from college, is looking to work for 2 years before she enters graduate school. She has received 2 job offers with the following salary structures:
Pawel spends half of the year working in Britain where he consumes British food q and half of the year in Poland where he consumes Polish food Q.
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