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In 2009, ABC Company made $2M of net profit and spent $100,000 on advertisement. In 2010, it made $2.5M of net profit and spent $150,000 of advertisement. Based on this information, if ABC's advertisement expenditure increases by $20,000 in 2011, how much do you expect its net profit to increase? Explain why the ratios of net profit to advertisement expenditure in 2009 and 2010 are different from the slope of the net profit advertisement relationship.
Q. Explain AS-AD model and inflation? Even though AS-AD permits changes in the price level, it doesn't allow for persistent inflation or deflation. We can't have continued decr
Index number formulas
what does phillip curve signify? how do you reconcile the difference in the shap of the curve in the short run and the long run?
Consider an economy in which George and Harriet consume only ale and bread. George's utility function is UG = aG(bG- 1) where aG and bG are his consumption of ale and bread. Harrie
Marginal propensity to SPEND refers to: a. a nation's additional spending on a good per an additional unit of expenditure. b. a nation's additional consumption based on a unit incr
Question 1: Critically analyse the costs of inflation. Which of these items is likely to have encouraged many governments in their adoption of inflation as public enemy number
If 5000 units are sold and income increases by 20% with an income elastiticy of +2, what will the number of sales units be after the increase
Compared with the situation before 1981, the marginal tax rates imposed on individuals and families with high incomes are now lower. What was the top marginal personal income tax r
Q. Control of ochratoxin? Control: Once ochratoxin A has been formed in a food, it is difficult to remove by most forms of food processing. Cooking with or without previous soa
Q. Classical model of the labor market? We begin by explaining the classical model of the labor market. The demand for labor L D is assumed to be inversely re
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