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Using the same simple macro model we developed in Module 2:
a. Show what will happen to national income (GDP) if the administration implements another $100 (billion) stimulus spending package.
b. Show what would happen if instead of a government spending package, the administration implemented a $100 tax cut.
c. From your results, find the numerical values of the derivatives dY/dG and dY/dT. (Hint: Numerically, dY is just the new value of Y less the old value and dG is the new value of government spending less the old one. Find the ratios of those numbers and you have found the value of the derivative.) Which policy has the largest effect and why?
if Q=120-2p is the equation for demand curve, find the compounding total, marginal and average revenue function
Interest rates Decreasing the rate of interest may not encourage investment but increasing the interest rate tends to lock up liquidity in the financial system.
Price rise in future must not be expected - law of demand If the buyers of a commodity expect that its price will increase in future they raise its demand in response to an in
what is demand estimation
b) Discuss the validity in Zimbabwe of the grounds on which the profit maximising model of the firm has been defended.
Bain''s limit pricing theory advantages and disadvantages
Q. Describe Managerial and behavioural theories? It was only in 1960s that neo-classical theory of firm was disputed by alternatives like behavioural and managerial theories. M
Planned Economy Is a system where all major economic decisions are made by a government ministry or planning organisation. Here all questions about the allocation of resources
monopoly
Harrod Domar Theory A basic principle that has been stressed by both Harrod and Domar in their growth models and which has been incorporated in all modern growth theories is th
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