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The structural deficit: A. falls as the economy expands and rises when it contracts. B. changes as actual income changes regardless of potential income. C. does not change when income changes, but changes only when potential income changes. D. rises as the economy expands and falls when it contracts.
Members of the Organization for Economic Cooperation and Development are: 20 countries formerly signed the Convention on the Organization for Economic Co-operation and Develop
Q. Describe the Keynes motivation? Keynes' motivation: In good times, when Y is high (above its trend), national income is high (above it trend). Consumers will take this opp
Suppose the supply function for product X is given by Qsx = -50 + 0.5Px - 5Pz. A. How much of product X is produced when Px = $500 and Pz = $30? B. How much of product X is p
A profit maximizing firm has a production function such that: Y=K2L2 a) If P=10,rk=2,andWL=3 , what would be its optimum be? How can you show that it is a maximum? b) How
Many economists and market analysts are avid followers of the BALTIC DRY INDEX (BDI) as a forward looking mechanism that may shed a bit of light on the evolution of global economic
Due to the recent downturn in economic activity, Taz, has seen his hours at work reduced. He used to work 30 hours a week at $13 and hour, but now he works 22 hours. Due to this
Utility Maximisation: Graphical Presentation Let consider a two-commodity world, x 1 and x 2 representing good I and good II respectively. p 1 and p 2 are the prices o
Suppose a company is considering two investment projects. Both projects require an upfront expenditure of $30 million. The company estimates that the cost of capital is 10% and tha
The Stop decay company sells an electric toothbrush for $25. Its sales have averaged 8,000 units per month over the past year. Recently, its closest competitor, Decay fighter, redu
ACCOUNTING SYSTEM-EXAMPLE Let us now introduce a complication. There are three firms in the production sector. The Fruit Extracts Company manufactures from raw fruit, fruit ext
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