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A) In 2013, the Australian economy experienced a mining boom. During the mining boom period, what effect does a change in expectations by households and firms would have had on the aggregate demand curve?
B) In the dynamic aggregate demand and aggregate supply model, what is the result of aggregate demand increasing faster than potential GDP?
C) Given the situation in part (b), if the Reserve Bank of Australia wants to move real GDP to its potential, should it use expansionary policy or contractionary policy? In your answer, make sure you explain whether the RBA should be increasing or decreasing the cash rate?
Calculated the point price elasticity of demand for Papa burgers and calculate the optimal price for Papa burgers if marginal cost is $1 per unit.
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difference between a movement along and shift of the demand curve
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The exponent of D in the above equation is +0.75. What does this say about the effect of bus fare on the demand for auto travel? Is the demand for auto with respect to auto travel-time elastic or inelastic? Please explain.
Sammy considers 2 wooden pencils to be a perfect substitute for 1 mechanical pencil. The price of 1 wooden pencil is $2, and the price of 1 mechanical pencil is $3. Sammy has an income of $18. What is Sammy's optimal consumption bundle
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1) Explain the concept of a price elasticity of demand. What does it mean to be highly elastic? Inelastic? What does an elasticity less than -1 (or greater than 1) indicate? What about greater than -1 (or less than 1) 2) Healthcare markets are unique..
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