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1. Discuss the causes of the Great Depression in terms of what you know about the economy today. Do you think another Great Depression is possible?
2. Suppose that you were in business and intended to build a plant to turn out a promising new item--say a pencil that would last twice as long as the kinds available now. What sorts of development might discourage you from making this investment? How much would your final decision hinge on what you anticipated for the future, compared with what you knew to be the situation today?
3. If your income (or your parents) were suddenly reduced to half, by how much would your expenditures fall? What sorts of businesses would be hit by your reduced spending? Would they, in turn, curtail their expenditures?6. Why is investment so critical in determining the level of prosperity?
Elucidate the effect of this inflow on the rental price of capital in the United States and on the quantity of capital in use.
Assume that a "leader country" has real GDP per capita of $40,000, whereas a "follower country" has real GDP per capita of $20,000. Next suppose that the growth of real GDP per capita falls to zero percent in the leader country and rises to 2 perc..
Suppose that natural real GDP is constant. For every 1 percent increase in the rate of inflation above its expected level, firms are willing to increase real GDP by 2 percent.
Assume that initially equilibrium was 200 units and that this was also full employment level of income
Illustrate what happens in the market for apartments when the government institutes a price ceiling that is lower than the market price. What could be some actions taken by renters and landlords when dealing with a price ceiling.
Say if the following statement is true or false and why-Exports depend only on the demand of foreign countries for our products and therefore our exporting
Who has the responsibility to decrease or eliminate unemployment. What is the role of business
A manager of a monopoly firm notices that the firm is producing output at a rate at which average total cost is falling but is not at its minimum feasible point. The manager argues that surely the firm must not be maximizing its economic profits.
The ability to create new products and process and to organize production to make goods and sevices available.
In spite of significant price increases for gasoline in the last two years, the amount of gasoline consumed has not decreased a lot--does this mean that gasoline is an exception to the law of demand or is there some other reasonable explanation?
When the price of paper increases from $100 to $120 per ton, the quantity supplied increases from 200 to 210 tons per day. The price elasticity of supply is?
Fixed costs exist only in the short run. In the long run there are no fixed costs." Why might the time frame for the "short run" differ from one industry to the next? Provide examples of two industries with different time frames for the short run
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