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Question 1
What would be the effect of an increase in Australia's net exports on the aggregate demand curve? Would an increase in net exports affect the RBA's monetary policy stance?
Question 2
Suppose that in an effort to reduce the current federal government budget deficit, the Australian government decides to sharply decrease government spending. Assuming the economy is at its long-run equilibrium, carefully explain the short- and long-run consequences of this policy.
Question 3
The recent debate about healthcare reform in the United States included arguments about how the proposed reform might affect the efficiency of the U.S. economy. Based on the aggregate demand and supply analysis, do you think that a more or less efficient economy is an important issue in this debate? (Hint: consider the long-run effect of a less efficient economy in the output level.)
How do you figure out the answer to this question: You are a student at a university. You pay $8,000 per year in tuition, $5,000 per year in living expenses, and $1,000 per year fo
Suppose that 70% of people who identify themselves as an "Independent" voter end up voting for a Republican candidate. What is the probability that out of 120 "independent" voters
What are cost and revenue relationships?
Equilibrium Income The next step is to use the aggregate demand function, AD, to determine the equilibrium level of income and output. This is done in figure . Recall that the
Differentiate between Actual and Potential output. Actual output is that level which economy in fact produces. In contrast, potential output is the aggregate capacity output o
Describe in detail about Exchange rate systems Various countries have different exchange rate systems. The most significant characteristic of an exchange rate system is to what
An ecologist is interested in the possible negative effects of marinas and boat mooring areas on the abundances of fish. Having read Hurlbert's paper about pseudoreplication, he de
(Consumer Price Index)Given the following data, what was the value of the consumer price index in the base year? Calculate the annual rate of consumer price inflation in 2013 in ea
Q. Interest rates and inflation? Assume you have 1 million on 1st January 2008. A basket of services and goods similar to the CPI basket costs 100,000. You can then purchase ex
Q. Why GDP is determined only by aggregate demand? Note that we haven't said anything about the aggregate supply so far. In order to justify why GDP is determined only by aggre
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