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We found GDP in 2010 was roughly $15,000 billion. You learned in Chapter 1 that GDP fell by approximately 3 percentage points in 2009. Use the simplest model of fiscal policy from Chapter 3 to answer the following.
1. How many billion dollars did GDP fall by in 2010?
2. If the propensity to consume were 0.5, by how much would government spending have to have increased to prevent a decrease in output?
3. If the propensity to consume was 0.5,by how much would taxes have to have been cut to prevent any decrease in output ?
Pick any public company and discuss which 2 or 3 macroeconomic indicators which would most profoundly affect that business and why.
Explain how does global economic competition impact price elasticity in domestic market and decisions related to strategy a firm uses to compete. Why do most economists oppose trade restrictions.
Describe the equilibrium price and quantity. What is the surplus of consumers and the welfare.
Use the principle of contestable markets theory, inter-industry competition, and foreign competition to provide an economic argument for or against deregulation of an industry.
Given below is information on all of the entries in Balance of Payments of a hypothetical developing country: What is the value of current account balance? What is the value of capital account balance? What is the value of cash reserve account?
What are some of the drawbacks that companies moving to Silicon Border should be aware of and need to manage?
An office building should last 60 years, but this owner will sell it at 20 years for 40% of its construction cost. For the first 20 years it can be leased as Class A space, which is all this owner operates. When the building is sold, the land’s cost ..
Assume all money is held in the form of currency. Assume central bank money (H) is initially equal to $100 million. Now suppose the Fed conducts an open market purchase of government bonds equal to $10 million. Explain the effect of this action on:
Explain what would happen to equilibrium price and quantity in the market for Pepsi if the following occurred (be sure to indicate WHY it happens as well)
Explain how do you think higher demand has affected equilibrium wage. In which direction do you think labour supply and demand shifted.
A bonus package pays an employee $2000 at the end of the first year, $2500 at the end of the second year, and so on, for the first 10 years of employment. What is the present worth of the bonus package at 5% interest?
Suppose you have hired a new worker, unfortunately you do not know if the worker is a shirker or a hard worker. Suppose working hard raises the probability of making a sale from 40% to 80% (thus raises the probability of making a commission C by the ..
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