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1. Suppose that aggregate demand increases by $1 billion, what would happen to equilibrium RGDP? Explain.
2. When the price level is falling, we experience deflation. This occurred in Japan not to long ago. What do you believe causes deflation? How might individuals and businesses react to deflation in a way that worsens it?
3. What would changing the rules to Employment Insurance payments so that it was more difficult to collect, do to potential GDP?
4. What can governments in Canada do to encourage economic growth?
Jo Brown’s nursery operation has grown from a small herb plot into a thriving nursery business. There are 10 full-time employees and 20 seasonal (part-time) employees. For the last three years taxable income for Brown’s Nursery has been steady at $35..
In the past year, oil prices have plunged from more than $100/barrel to less than $50/barrel. What impact has this had on OPEC and other oil producing nations? What's the benefit to consumers and manufacturers?
Rita borrows $5,000 from her parents. She repays them $6,000. What is the interest rate if she pays the $6,000 at the end of year 2? At the end of year 5? Draw a cash flow diagram. Show all steps.
Rosita owns a stock with an overall expected return of 14.40 percent. The economy is expected to either boom or be normal. There is a 52 percent chance the economy will boom. If the economy booms, this stock is expected to return 15 percent. What is ..
The economy is starting from a point of disequilibrium as there is a recessionary gap. Potential GDP is $600 billion and the recessionary gap is $50 billion. An economic shock then hits this economy and there is a sudden drop in the value of the Cana..
Elucidate how banks and individuals can use "covered interest arbitrage" to protect themselves when they make international financial investments.
Expansionary monetary policy, or an "easy money" policy by the Fed..
Suppose a Canadian lumber company has a world monopoly on lumber. That is, imagine that all lumber purchased by U.S. citizens is bought from this one Canadian lumber company. Suppose the U.S. government imposes a price ceiling. What is the optimal pr..
How have financial innovations increased the liquidity of home mortgages since the late 1970s? Has this increase in liquidity tended to increase or decrease the interest rate on home mortgages? Explain why.
Is the apple pie market perfectly competitive? Why or why not? b. With this data, draw a graph of the linear demand curve for Granny's apple pies. c. Find the price elasticity of demand at each of of the three prices.
Elucidate how many workers the firm should hire for different values of the wage rate in order to maximize profit.
q.given your answer in part b if px would increases by 10 by what percentage would sales decrease? what impact would
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