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Keynesian Business Cycle Theory. John Maynard Keynes believed investment was the engine of long-run economic growth. Not only that, he believed that the volatility of private investment spending was the dominant cause of business cycles (recessions and expansions). He argued private investment spending was subject to wild fluctuations because 1) the future is fundamentally uncertain and 2) managers can be subject to waves of unwarranted optimism and pessimism ("animal spirits").
a. What is an example of fundamental uncertainty? In other words, give an example of something no one could have predicted.
b. Taking into account "animal spirits" why might business owners be reluctant to increase their investment spending even after the coronavirus starts to stabilize?
In an effort to estimate the mean amount spent per customer for dinner at an Atlanta restaurant, data were collected for a sample of 42 customers. The data collected resulted in a sample mean of $29. Based upon past studies the population standard..
Assume an individual purchases 500 units of good and spends 10,000 dollars.
List two reasons why there is concern for the plight of developing countries.
If the real interest rate is less than the growth rate of output, explain why governments can run a deficit yet not have to worry about the size of their debt.
4. Sam consumes green eggs and ham. Ham and green eggs are both normal goods.
If the university is currently hiring 1000 units of labor per week, calculate the marginal cost of an additional unit of labor.
Discuss the role of macroeconomic policy in reducing unemployment and inflation. In your discussion make use of the diagrammatic representation of the macroeconomy
Inflation is 2 percent, and your marginal tax rate is 35 percent. What is your after-tax real rate of interest
The production possibilities curve below sho the hypothetical relationship between the production of food and clothing in an economy.
GB540: Economics for Global Decision Makers Assignment. Discuss the risks of introducing market mechanisms of supply and demand in situations
Grocery stores and gasoline stations in a large city would appear to be examples of competitive markets there are numerous relatively small sellers, each seller is a price-taker, and the products are quite similar.
Econ104- Explain and show your calculations (using the template at the end of this assignment) of how you would set up the present value calculation in your uncle's case.
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