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Questions: 1. The economy is in a recessionary gap What are the fiscal policy options available to the government?
2. Suppose that real GDP is $1,300 and potential GDP is $1,800, while the marginal propensity to consume is 0.6. If the government is going to engage in government spending and imposes no taxes, what specific fiscal policy action should policy makers take?
3. Most economists do not support a law that requires the federal budget to be balanced every year. Explain why
4. What is the goal of expansionary monetary policy, and how does it work in the short run?
5. Suppose the annual inflation rate is at 2%, and 8.5% of the labor force is unemployed. If you were on the Federal Reserve's Open Market Committee, what action would you prescribe? How would this affect the economy, the inflation rate, and the unemployment rate?
Analyzing macroeconomic events with the IS curve (II): Consider the following changes in the macroeconomy. Show how to think about them using the IS curve.
What is the marginal revenue when output - What is the present value of $575 in one year if the current rate of interest is 4 percent?
Assume an initial exchange rate of A$1=Yen100, and then show numerically how a strengthening $A (assume the exchange rate becomes A$1 = Yen 200), other things equal, is bad for Australian car manufacturing firms.
Compare two cars A and B. The initial cost of Car A is $500 more than Car B. However Car A consumes 0.01 less gallons/mile compared to B.
Provide examples on how the availability of close substitutes affects price elasticity of demand for a good or service.
Explain why an indifference curve is convex to the origin?
What should Ms. Jones consider before making this decision? What calculations should Ms. Jones make? What other savings would Ms. Jones realize?
1. of u.s. firms with less than 500 employeesnbsp less than 25 export less than 40 export less than 5 export over 50
In the imperfect competitive market of jeans, Lean Jeans, Inc., recently offered rebates of $1 off the regular $50 price. Quantity sold jumped 4 more jeans from the previous 100 figure the previous month.
What are the differences between economic and accounting concepts of cost. How are prices determined under perfect competition
1.Which of the following resulted in a surge in international lending to developing countries in the mid-1970s to early 1980s? Oil-exporting countries had a low short-run propensity to save out of their extra income.The real interest rates in the ind..
It is 1932 and you are an economic advisor to President Roosevelt. what advice would you give the president in light of the economic problems facing the country?
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