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Consider the market for the trusty widget (the most common good in the world if economics textbooks are to be believed). Assume that the market is perfectly competitive. Suppose th
how can the central bank influence the size of the multiplier
Enumerate the statement- Interest rates with longer maturity Since loans with longer maturities are substitutes for overnight loans, the central bank also has some control o
Incentives Incentives designed to increase effort, reward enterprise and encourage saving and investment include: an emphasis on the effect of a reduction in the margi
1) Consumption is positively related to stock market wealth but negatively related to taxes and tax rates.
Give a brief description of the transmission mechanism 1. When the central bank target rate increases, other interest rates in the economy will increase (and the money supply
Suppose that several months of data showed the CPI increasing at a 4.5% annual rate due largely to increases in the price of energy and food related commodities following several y
Discretionary fiscal policy will stabilize the economy most when: A.) deficits are incurred during recessions and surpluses during inflations B.) the budget is balanced each year C
According to the imperfect-information model, when the price level is greater than the expected price level, output will _____ the natural level of output A) be greater than
What is the price elasticity of demand? It is the Defining and Measuring Elasticity. The price elasticity of demand is the ratio of the percent modification into the quantit
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