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A restaurant/bar is analyzing its pricing of beer. It has determined that the price elasticity of demand for beer is 0.8, the cross-price elasticity for wine with respect to the pr
Explain about the circular-flow of economic activities. Circular-Flow of Economic Activities: Economic Agents: a. Households b. Firms Where they interact:
Money is generally considered to have three economic functions: A medium of exchange. This is its most significant role. Without money we would live in a barter economy wher
Q. What is Labor Market? Labor market in the IS-LM model is the same as in cross model. Hence the IS-LM model is only applicable if profit-maximizing quantity of L would result
Consider two consumers, A and B. A and B both want perfect consumption smoothing (c = cf) and both have no current wealth. However, the two consumers have different income streams.
Raising chickens requires several types of feed, such as corn and soy meal. Consider a farm in the former Soviet Union. Try to describe how decisions on the number of chickens to b
Q. What is money and what is not money? If you are trying to conclude if something is money, basically consider whether it would be accepted in most stores as payment. Then you
Calculating interest rates on a yearly basis If maturity is different from one year, interest rate is generally recalculated to a corresponding one year rate. For instance con
Discuss about the Keynesian economists The Keynesian economist A. W. Phillips developed short-run Phillips curve analysis in the 1950s. Phillips had researched the relationshi
Suppose you buy call options on Microsoft stock. Each option costs $2 and has the strike price of $40 and the expiration date July 1. Discuss whether you would exercise the options
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