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In the long-run framework, budget surpluses: A. should be run on a permanent basis since they boost saving and investment and stimulate economic growth. B. should be run whenever output dips below potential output. C. should never be run since they crowd out investment in the short run. D. are better than budget deficits over the long run because unlike budget deficits, they increase saving and investment.
Store of value - Economic functions of money If you are a fisherman and have a temporary surplus of fish that you want to store for the future, storing the fish might not b
Q. Determination of all the endogenous variables? Determination of all the endogenous variables in the AS-AD model Determination of P and Y: Prices and
what is stagflation
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
Crowding out would most likely occur when: A. the Congress enacts budget cuts to balance the budget. B. workers lose jobs as a result of anti-inflationary fiscal policies. C. the f
with reference to incidence of taxation, explain with the help of a diagrams, who bears the incidence of taxation when the demand for a commodity is (i)perfectly inelastic (ii) uni
1) Assume that the production function for New Zealand is given by Y = AK0.57L0.43, where Y is real GDP (in 2000 constant dollars), K is real capital stock, L is labour. The parame
Illustrate an example of Consumer Price Index For instance, if we spend twice as much on apples as on pears, apples would have twice the weight in basket. The precise details o
What is Treasury bills In most countries you will find many types of government bonds. An important distinction is the duration of the bond, that is, the difference between the
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
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