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In 2007, the potato chip industry in the Northwest was competitively structured and in long-run competitive equilibrium; firms were earning a normal rate of return and were competi
Q. Consumption function in the AS-AD model? Consumption. Suppose that P increases by say 10% whereas real GDP (Y) is constant. Nominal GDP and nominal national will now have
Is it true that government revenues are increased because of lower tax rates? Ans) It is true to a point. The Laffer curve determines that revenues enhance as the tax rates rise
Danny is an investment banker and has income I = 300. When prices are px = 10 and py = 20, Danny consumes the bundle (x; y) = (6; 12). 1. Illustrate Danny's budget constraint
n 2013, approximately 58 percent of the adult population (245 million) was employed, the lowest employment rate in 20 years. If the employment rate increased to the prerecession l
Historically, shifts toward a more expansionary monetary policy have often been associated with increases in real output. Is this surprising? Why or why not? Can an expansion in th
Changes in Money Market Equilibrium A shift in either the supply curve for money or the demand curve for money will alter the equilibrium position in the money market (and the
Suppose one of your clients is four years away from retirement and has only $1,500 in pretax income to devote to either a Roth or a traditional IRA. The traditional IRA permits inv
What causes a supply curve to shift? a. Changes into Input Prices An input is a good which is used to generate another good. b. Changes into Technology c. Chang
Show the market for cigarettes paying particular attention to the price elasticity of demand and supply. What would happen to the total expenditure on cigarettes if there was a tax
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