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In the real business cycle model, suppose that government spending increases temporarily (i.e.,Gt increases but Gt+1 does not). Determine the equilibrium effects of this using the diagrams of labor market equilibrium and goods market equilibrium. Briefly explain why demand or supply curve shift in a certain direction. Could the comovement of macroeconomic variables be explained by fluctuations in Gt? That is, does the model predict the procyclicality of consumption Ct, investment It, employment Lt, and real wage Wt?
How do government policies and/or regulations factor into changes in economic activity on both a domestic and global scale? Give a specific example of a policy or regulation that has helped economic activity.
Now consider what would happen to the market for Gatorade if there was a large decrease in the price of Powerade. Drawing a supply and demand graph will aid in answering this question. There is a decrease in the demand for Gatorade, which results in ..
Using your answer to part a. above, how could you have predicted this change in total monthly revenue?
What should happen to the equilibrium price, interest rate and quantity of bonds if the economy starts to improve after the events in question 7? Use the simple single bond market we developed in class to answer this question. It should be obvious th..
q1. illustrate what are the implications of savings and population growth at steady a state in the solows neoclassical
For each of the following events, assume that either the supply curve or the demand curve (not both shifted). Explain which curve shifted and indicate the direction of the shift.
“In a situation of increasing opportunity costs, trade can be beneficial to both countries if they have identical tastes. However, trade cannot be beneficial to either country if the countries have identical PPFs” Is this statement correct of incorre..
Determine two (2) likely factors that might have caused the change. Predict the primary manner in which this change would likely impact business operations in the new market environment.
Financial management of a department is difficult to say the least. Our departments are labor intensive and have highly technical equipment, both of which are very expensive. Please develop two methods for labor and equipment that would provide quali..
Write down demand and supply equations for wireless phones; include two exogenous variables in each equation. Draw a supply-demand graph for wireless phones. Use your graph to show how a change in one of your exogenous variables affects the model’s e..
Which statement is ture as it regards: International Economic Linkages
Assume company X deposits 100,000 in cash in Commercial Bank A. If no excess reserves exist at the time this deposit is made and the reserve ratio is 20%, Bank A, by itself, can initially increase the money supply by a maximum of?
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