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Problem: A publisher is deciding how best to sell the textbooks of Microeconomics and Macroeconomics. The publisher can either sell Microeconomics and Macroeconomics separately as two textbooks, or bundle them as one textbook that contains both subjects. Suppose the cost of supplying the textbooks is zero. There are two students in the market and their willingness to pay for the content are summarized in the table below.
Microeconomics. Macroeconomics
Mary $40 $x
Nancy $100 $30
Q: Suppose x = 35 . To maximize profit, should the publisher sell the books as a bundle?
Why might it be difficult for the Fed to formally adopt inflation targeting? Would inflation targeting be a good policy for the Fed in the present economic environment
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Describe the present economic crisis situation in Europe. Why has it been so difficult for the Europeans to find a solution to this problem? Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..
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Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."
Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.
How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.
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