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Q1. Block's sells 500 bottles of perfume a month when the price is $7. A huge increase in resource costs causes price to rise to $9 also Block's only manages to sell 460 bottles of perfume. The price elasticity of demand is:
Q2. For a developing country to grow it needs capital. The major source of capital in most countries is domestic savings but the goal of stimulating the domestic savings usually is in conflict with government policies aimed at reducing inequality in distribution of income.
1. Comment on this tradeoff between equity also growth.
2. Explain how would you go about resolving the matter if you were the president of a small poor county?
Producing nations outside the organization, like Britain and Norway, should do their share and cut production.
Explain how is world currency valued against the US dollar such as Euro and Chinese.
Show that if the food stamps could be legally re-sold, the welfare of the household would be increased. Give one reason why food stamps should not be re-sold.
Utilizing the standard IS/LM model, elucidate how the scope of monetary policy to change real economic activity in the short run depends on the private sector reaction to interest rate changes.
Suppose, on the other hand, that the second country retaliates with an export subsidy of its own.
Calculate the optimal money growth rate needed for the Fed to hit its inflation target in the long run.
Elucidate in detail how banks operate. Include a description of how banks generate profits.
Suppose that they are thinking of every specializing completely in the area in which they have a comparative advantage also then trading.
Discuss the current state of the Chilean economy by focusing on the recent past and macroeconomic characteristics
It was reported that the price of kerosene heaters skyrocketed and the number purchased increased during this time.
The production process requires labor and capital as inputs. Labor costs $6 per labor hour and capital costs $12 per machine hour.
Why do proponents of active policy recommend government intervention to close an expansionary gap. Some economists argue that only unanticipated increases in the money.
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