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Y= C+I+G C= 100,000000+ 0.4yd I= 400,00000 T= 0.2+60m G= 750, 000000 Calculate equilibrium level of income
The United States is considered to be an industrialized nation because we have such a high standard of living. Countries with lower standards of living are considered to be emergin
Oil price shocks lead to large adverse supply shocks in the macroeconomy, infer Dornbusch et al (2008) who define an adverse supply shock as; ‘one that shifts the aggregate supply
Axiom of completeness: Consumer's choice is complete. Implication: Since consumer is rational, she must have a unique preference relation. That means the consumer choice is ei
Q. Equilibrium in the labor market? Equilibrium in the labor market Real wage W/P will be equal to the equilibrium real wage in the classical model
Assume that an economy's GDP Y=5000. Also assume that the government runs a deficit where tax revenue T=1000 and government expendituresG= 1500. The consumption function is represe
Q. What do you mean by Supply of money? Supply of money The supply of money is an exogenous variable in the IS-LM model Money supply is enti
The monetary system in any economy facilitates trade and allows people to trade more efficiently, as compared to a barter economy. In the United States, the monetary authority is t
Explain the purposes economists disagree and using models of economics. Using Models of Economics: a. Positive economics b. Normative economics A forecast is an easy p
In order to encourage you to take interests in the current affairs in business, and have more concerns about the real world problems (which is what economics is about), you are req
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