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1) IMF orders country A to cut its budget by 25% and reduce the value of its currency by 40%. Before these changes the country had a GDP of 4000 billion and a G of 1200 billion, a trade deficit of 300 billion and a C of 2000 billion. After the IMF suggestions the following changes were noticed: a trade surplus of 100 billion, a reduction in C of 5%, and an increase in I of 50%. What is country A's GDP after the IMF orders were implemented?
2) Country X has a balanced budget, an actual GDP of 15,500 billion and a gap to potential GDP of 1000 billion. There are 2 political parties: the Bronze Age Party which recommends to cut taxes by 400 billion if elected, and the Spend Happy Party which suggests a 500 billion budget deficit. a) what will be the inflation rate if the Bronze Age Party wins and implements its platform? b) What will be the inflation if the Spend Happy Party wins and implements its platform?
3) Country A is on the PPF. It decides to run a budget deficit of 100 billion. Both its potential and actual GDP is 800 billion. What will happen if country A decides to run this deficit? And why? Give a full explanation for this expected result.
What is the diff erence between Absolute and Relative PPP? Which theory requires fewer assumptions and give two reasons why Absolute PPP might not hold in the short-run.
Describe breifly about Critical evaluation of Adam Smith's Theory and outline of its purest form and what is its critism.
Identify the funding mechanism of the project, and the sources of funding. Identify the key players or stakeholders of the project. Who is supposed to benefit from the initiative?
The Internet has allowed for raised trade in services such as technical support, a development that has lowered the prices of such services related to manufactured goods.
Assume that in England five man hours of labor are needed to make each cask of wine and five man-hours are needed to produce each bolt of cloth,
The economy's Investment Function, indicates that when the expected real rate of interest increases agents in the economy respond and what happens to the import price of this tablet and the number of tablets imported into the US?
Suppose the PRE government offers Exportian "stuff" producers an export subsidy of $3 per unit. In addition, the government imposes a tariff of $3 per unit on imports of "stuff". Calculate the price paid and quantity demanded by Exportian consumer..
Discuss how deficit spending relates to the economic collapse of the Greece and Spain economies. Relate their economic collapse to U.S. current economic problems.
The widget industry in Anytown is a monopoly, controlled through Widget Corporation Its demand curve for the local market is given through
With the various sectors fighting each other in order to influence Japanese policy-makers, what is likely to happen to the yen and why was the yen strengthened even though the Japanese economy has been in a very sluggish growth pattern for a decade..
Determine the free trade equilibrium. Then calculate and graph the following effects of an import quota that limits imports to 50 bags. a. The increase in the domestic price b. The quota rents c. The consumption distortion loss d. The production d..
Presidents, senators and members of congress came from a different backgrounds but all must decide upon a great many issues that involve macroeconomics.
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