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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?
NOMINAL RIGIDITIES VERSUS REAL RIGIDITIES Nominal rigidities are said to exist when nominal prices and wages do not change in the face of conditions that call for thei
Q. Illustrate about Pecuniary economies? Pecuniary economies (which is monetary economies) are those economies accrued by the firm from paying lower prices for the factors used
arguments in favour of traditional theory of profit maximization
cvp analysis
how it is revalent?
Using Total Expenditure for Calculating National Income The expenditure approach centres on the components of final demand which generate production. It thus measures GDP
Functions of Commercial Banks In modern economy, commercial banks have the following functions: i. They provide a safe deposit for money and other valuables. ii.
"Inflation is not possible under the gold standard." Is this declaration true, false, or uncertain? Describe your answer
Individual and market demand schedule The plan of the possible quantities that will be demanded at different prices by an individual is called Individual demand schedule. Su
1. A sporting goods company has hired a management consulting firm to analyze demand in 20 regional markets for one of its major products: a treadmill. The consultant uses data to
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