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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.
In real life, the operation of simple multiplier is affected by many leakages. Leakages in the multiplier arise out of the following reasons: (1) Saving: If all the income is sp
The Red Lobster sells fresh seafood. Red Lobster receives daily shipments of farm-raised fish from a nearby supplier. Each fish cost $2.50 and is sold for $4.00. To maintain its re
Q. Is Consumption depend on GDP in the cross model? Aggregate demand The consumption function Consumption C(Y) depends positively on GDP in the cross
when supply of money increase what happen r,y.I.c
Suppose three identical firms are engaged in Cournot competition in quantities. They all have marginal costs equal to 40. Market demand is given by: P(X) = 200 - X = 200 - (x
Describe the meaning of word -Investment When we use the word investment, we generally mean "gross investment". Essentially, gross investment comprises all finished goods which
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
Use the points on the graph below to answer the following questions. i) What is Ep along D1 (from A to B)? ii) What is the Ep along D2 (from X to Y)? iii) What are
Relate overnight interest rates with interest rates By controlling overnight interest rates, the central bank will affect the interest rates with longer maturity. The reason f
In The No-Trade Equilibrium Stormlands: WageL = 24 WageW = ? MPLL = 4 MPLW = ? PL = ? PW = 4 Reach: Wage*L = ? Wage*W = 6 MPL*L = ? MPL*W = 1 P*L = 3 P*W = ? (a) Which
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