Initial increase in aggregate demand

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Reference no: EM1315015

Q1. If a representative firm with total cost given by TC = 20 + 20q + 5q2 operates in a competitive industry where the short-run market demand also supply curves are given by QD = 1,400 - 40P also QS = - 400 + 20P, its short-run profit-maximizing level of output is:

Q2. If the MPC is 0.80 also there is no crowding- out effect, then an initial increase in aggregate demand of $100 billion will eventually shift the aggregate demand curve to the right by

Reference no: EM1315015

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