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What is the difference between real GDP and nominal GDP? What is the difference between the real interest rate and the nominal interest rate? How would not knowing the difference effect perceptions of the economy and affect people's decisions?
Suppose that natural real GDP is constant. For every 1 percent increase in the rate of inflation above its expected level, firms are willing to increase real GDP by 2 percent.
The questions posed are broad and open ended so be careful to allow yourself enough research and planning time.
Consider economy that is above full-employment equilibrium (natural rate of output) because of an increase in AD. Prices of productive resources have'nt changed. With the help of graph
Discuss how each of the following developments would affect the supply of the money, the demand for money, and the interest rate. For each case, describe what happens in closed economy and in small open economy. Describe your answers with diagrams.
As the manager of Pelican Point Financial Group, you are unable to determine whether any given individual is a high or low volume transaction investor. Design a self-selection mechanism that permits you to identify each type of investor.
Let's say there's a world-wide influenza pandemic. Assume that the marginal cost (supply) of influenza vaccinations is constant at $40. Assume that everyone in society has health insurance that pays 80% of all medical services
Explain how the Central Bank can set the nominal interest rate in the money market. In addition, explain how it can use expansionary monetary policy to boost GDP if the economy is in a recession.
Graph the accompanying demand data, and then use the midpoint formula for E d to determine price elasticity of demand for each of the four possible $1 price changes.
Pam, having recently graduated from college, is looking to work for 2 years before she enters graduate school. She has received 2 job offers with the following salary structures:
Make an example of a comparative advantage model by 'choosing two countries and two products.
If I told you that GDP was forecast to rise by a bit more than 3% over the next year, what would that mean to you? What should you be asking about the forecast?
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