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The federal government implemented the Cash for Clunkers program in July 2009 as part of an effort to stimulate the economy, and the U.S. auto sector in particular. Under the program, Americans who traded in an older, "gas guzzling" vehicle for a more efficient new vehicle were eligible for a $3,500 to $4,500 voucher. In total, Congress allocated $3 billion to the program, which resulted in 650,000 new vehicle purchases. Proponents argued that the program would not only be good for the economy, but also good for the environment as consumers bought new, more fuel-efficient cars.
Use the supply and demand models to estimate what impact this program would have on consumer demand for new automobiles. How about used cars? Given this change in demand, what do you predict would be the impact on the market equilibrium price and quantity of automobiles sold in the United States? Display your findings with graphs.
1.Graphically illustrate and explain why a fixed exchange regime without foreign exchange controls is incompatible with inflation targeting.
The dollar declined sharply in 1973-4 and 1977-8, and those declines were accompanied by sharply higher inflation. However, when the dollar declined even more.
Suppose households unexpectedly increase consumption and the central bank keeps the interest rate fixed. Which of the following will occur as a result of this consumer optimism?
In January, buyers of gold expect that the price of gold will rise by February. What happens in the gold market in January, holding everything else constant
The demands of distribution centers d and e are 2,300 and 1,400 items, respectively. The transportation is conducted by truck at the cost of 8 cents per item per kilometer. Design a transportation problem to minimize transporta- tion costs
Which of the following conditions would indicate that a perfectly competitive firm should expand its output to increase its profit?
Moral hazard is a problem because poor borrowers lack collateral. If they had collateral, it could be taken away, providing a punishment to shirkers.
Suppose that Kenji, an economist from an AM talk radio program, and Lucia, an economist from a university in Massachusetts, are arguing over budget deficits.
Explain how a general sales tax of 8 percent could be regressive. Now, suppose that food and children's clothing are exempted from the sales tax.
ann mccutcheon is hired as a consultant to a firm producing ball bearings. this firm sells in two distinct markets each
Identify the separation period, the instructional period, and the reincorporation periods as the girls' experiences are described in the video. Explain when and why each phase occurs.
Create a PowerPoint proposal that you would present to the Board of Directors. What would be gained if leadership of the organization agreed to partake in your research?
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