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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.
A recent article estimated that the elasticity of the rate of gonorrhea with respect to the price of beer is about 0.8. If this estimate is correct, are unprotected sex and beer su
Foreign Direct Investment and Development: In neo-classical economic theory, FDI involves the movement of capital from capital abundant to capital scarce host countries. Mun
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define the economic principle of opportunity cost explain whether spending 17.9% of gdp is too much or too little to spend on healthcare
Two people are engaged in a joint project. If each person i puts in the effort x i , the outcome of the project is worth f ( x 1, x 2). Each person's effort level x i is a
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Suppose that the yield curve is flat at 5% per annum with continuous compounding. A swap with a notional principal of $100 million in which 6% is received and six-month LIBOR is pa
THE PRODUCT MARKET Z=C+I+G C=a+bYd I=Io+I1Y-I2i Equilibrium condition, Y=Z, where Y represents output and Z is aggregate spending. THE FINANCIAL MARKET Md=MT+Mp MT=MTo+MT1Y Mp=Mpo
What are the important aspects in tracking the macro-economy? Important aspects in tracking the macro-economy: a. How economists utilizes aggregate measures to track the pre
An attorney supplies 40 hours of work per week when her fee is $100 per hour but supplies 60 hours of work per week when her fee rises to $120 per hour. Using the midpoint formula,
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