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You are hired by the Council of Economic Advisors? (CEA) as an economic consultant. The chairperson of the CEA tells you that she believes the current unemployment rate is too high. The unemployment rate can be reduced if aggregate output increases. She wants to know what policy to pursue to increase aggregate output by? $300 billion. The best estimate she has for the MPC is .8.
Which of the following policies should you? recommend?
Select one:
a. Reduce the budget deficit by? $300 billion.
b. Reduce taxes by? $75 billion.
c. Increase government purchases by? $75 billion.
d. Reduce taxes by? $75 billion and to increase government purchases by? $75 billion.
Using the notions of ex ante and ex post interest rates, explain how a bank could be expecting a huge return on its investments and end up with very small real
the following model is a simplified version of the multiple regression model used by biddle and hamermesh 1990 to study
1. Explain why are the real reasons about immigration (economics and social issues). 2. What are the effects In the unemployment and what sector is being affected the most because immigration and why.
Suppose a firm is attempting to maximize profits. If the firm increases production from 10 units to 11 units, and the market price is $20 per unit, total revenue for 11 units is: A. $20. B. $200. C. $220.
Using the formula for the multiplier for changes in government purchases and for changes in transfers, calculate the total change in real GDP due to the $10
(a) Describe the initial set-up of the market; (b) Analyse the effects of the local policy on the market in the short-run;
Calculate the point elasticity of demand at equilibrium. Provide the general formula and show your calculations. Is demand elastic or inelastic? Explain your answer. Given this answer, will producers enhance their total revenue by increasing or by de..
Consider Gaby's utility function u(X1, X2 ) = 4vx1 + x2, where x1 is the consumption of rice and x2 is "everything else". Assuming the income is m and the price
If a good has an income elasticity of demand equal to 2.7, how will the quantity demanded change when consumer income rises by 4 percent? (Please explain to me how you solve this, thank you!)
How independent is the Federal Reserve? Based on the experiences of the Fed in the U.S., as well as other central banks, do you believe that the Fed should be independent?
Particularly indicators of improving or reducing levels of performance, used by your organization, and how those indicators relate to the kind of "national indicators" we have been Analyzing.
Unlike equity, debt is unforgiving if the firm performs poorly. If a firm goes bankrupt, debtholders have the right to repossess funds and exercise their residual control rights about how the funds will be spent. Thus, under debt financing, debtho..
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