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How is the equilibrium interest rate determined in the market for money?
What are the goals and tools of monetary policy?
Suppose interest rates pick up in the next two months so that, in August 2017, banks flood the market with the excess reserves they've been holding since 2008. Illustrate this scenario with a perfectly-sticky AS-AD model and use the current moneta..
How does an open market purchase by the Fed affect the level of bank reserves and the interest rate? How will GDP be affected? Explain the causal chain. Explain how interest rates and bond prices are related to one another. Why is this important for ..
Which of the following is upward sloping?
Assume that the economy is beginning at equilibrium. There is a supply shock and OPEC has decided to increase production, which lowers the price of oil. What will happen to the price level and RGDP in the short run? Label the original point (A) and t..
Suppose the demand of the good is P = 12 - Q. A monopolist's total cost is TC = 2 + 4Q. What's the optimal price and quantity of the monopolist?
The Teenager Company makes and sells skateboards at an average price of $70 each. During the past year, they sold 4,000 of these skateboards. The company believes that the price elasticity for this product is about -2.5. Which of the following would ..
The Internet has enabled workers and companies to find each other more quickly and to make better matches with substantially lower costs. The result is: a. lower cyclical unemployment. b. lower structural unemployment. c. higher frictional unemployme..
Suppose the government increases aggregate demand to a level that increases GDP above its long-run equilibrium level. What sequence of events would follow? A)Prices rise; nominal GDP increases; workers demand higher wages; short-run aggregate supply ..
An economy produces 2 goods soda a beer. Fully explain why the marginal cost function in the beer industry derives from the marginal benefits of the soda that is given up when beer is produced.
When the price of pears fell to $3, what part of the change in Sarah's demand was due to the income effect and what part was due to the substitution effect?
It is said that a wage increase can have two opposing effects. Which of the following captures these two effects?
Describe whether Indian Consumer goods industry is growing at the cost of future profitability.
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