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Suppose the banking system has reserves of $750,000, demand deposits of $2,500,000 and a reserve requirement of 20%. a) If the Fed now purchases $125,000 worth of government bon
Because the structure of the personal income tax is progressive, a larger share of income is taxed at higher rates as real income increases. Therefore, economic growth automaticall
how to solve problem of scarcity and choice
Q. How much money can banks create? Does that mean that banks can create an unlimited amount of money? No the answer is no - it would require them to lend an unlimited amount o
What are the three methods that societies have used to allocate their scarce resources? Give an example of each method. Give an example of a good that uses all three methods at onc
You win a lottery. You have the choice of two ways to be paid. If you pick Payout Scheme X, you get $2,750 today. If you pick Payout Scheme Y, you get three payments: $1,000 today,
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Q. Illustrate the Says Law? With Say's Law, aggregate demand would always be equal to aggregate supply and cross model would be incorrect. Keynes's argument as to why Say's
Firms such a Moody's and Standard & Poor's study corporations that issue bonds. They publish "ratings" for the bonds- evaluation of the likelihood of default. Suppose these rating
critically analyse the ways at which the government of zimbzbwe has put in place to address unequal employment opportunities between men and women
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