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Given that price elasticity of demand is a real factor that impacts revenue collection as well as behavior modification through social engineering, how 'should' government react?
400 Words......
Suppose that inverse demand is given by p(Q) = a-bQ, where Q is total quantity supplied in the market. There are two firms in the market, each with a cost function of c(q) = cq. What is the profit function of each firm? Compare the output and price t..
The following graph shows the market for loanable funds in a closed economy. The upward-sloping orange line represents the supply of loanable funds, and the downward-sloping blue line represents the demand for loanable funds.
When the US. Treasury sells bonds, the money supply does not increase, while when the Central Bank sells bonds, the money supply contracts. Explain why?
Suppose firms become very optimistic about future business conditions and invest heavily in new capital equipment. Now use the diagram from part A) to show the new long-run equilibrium of the economy. (Assume there is no change in the long-run aggre..
Which one of the subsequent was not a contributing cause of the decline in investment also thus the recessionary expenditure
Select the best description of zero-day vulnerabilities. Support your choice by describing why your choice is the best description.
In the space below, draw the new Keynesian sticky prices model. Label completely and correctly. Next, suppose there is an output gap. Suppose the government chooses to use scal policy to close the output gap. Illustrate this approach. State why each ..
The Fed announced in April 2011 to it will continue the ‘quantitative easing' by completing the purchase of government securities by the amount of $60 billion.
Felix chooses between clothing, q1, and food, q2. his initial income is $1000 a month, p1=100 and p2=10. at his initial bundle he consumes q1=2 and q2=80. Later, his income rises to $1200 and the price of clothing rises to p1=150, but the price of fo..
Explain what action should be taken in terms of adjusting output if it is determined that marginal cost is greater than marginal revenue.
Assume the total population is 180 million and there are 1 million discouraged workers, 9 million unemployed workers, 20 million part-time workers and 121 million workers employed full time. The unemployment rate is: 5 percent 6 percent 6.4 percent 7..
Suppose that you own a 25 year old movie theater in Micropolis. It has 6 screens and a concession stand. Across town there is a 7 year old movie theater with 4 IMAX screens and 20 more regular screens. Define price discrimination. Describe a price di..
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