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Suppose government were to provide free daycare for children and assume this has no effect on the real wage w, taxes T, and dividend income π. Determine effect of the daycare program on consumptio
If a country has __________ in the production of an item, it can produce __________ of the item (for a given quantity of resources) than can other nations
In many industries, such as supermarkets, banks, cell phonecompanies, etc., because of mergers our choices as consumers arereduced to two or three competitors. Do you think thisis good for the econ
1. How many glasses of brandy and cigars are consumed during andevening 2. Now the sum of brandy and cigars consumed in the day isless than or equal 5. What's the optimal consumption under this cons
Consider the 2-period environment from class.The economy is populated by two types of agents A and B. There is an equalnumber (N) of each type. The agents have preferences which incorporate impatien
Suppose that thedemand curve for corn is downward-sloping but that the supply curveis perfectly price inelastic at a quantity of Q* once the corn isharvested. Furthermore, assume that the equilibriu
"The most disruptive supply shocks in recenthistory were caused by OPEC, the Organization of PetroleumExporting Countries. In the early 1970s, OPEC's coordinatedreduction in the supply of oil nearly
An economy is inlong-run macroeconomic equilibrium when each of the followingaggregate demand shocks occurs. What kind of gap-inflationaryor recessionary-will the economy face after the shock
Suppose the Bulyanhulu mine always producesat the scale where its marginal cost equals the selling price ofgold. Its marginal cost curve however, shifts with changes inelectricity process, wages and
In each of the following cases, either a recessionary orinflationary gap exists. Assume that the aggregate supply curveis horizontal so that the change in real GDP arising from a shiftof the aggrega
Most macroeconomists believe it is a good thing that taxesact as automatic stabilizers and lower the size of themultiplier. However, a smaller multiplier means that the change ingovernment purchases
An economy is in long-run macroeconomic equilibrium when each of the following aggregate demand shocks occurs. What kind of gap-inflationary or recessionary-will theeconomy face after the shock
suppose that in one year household consumption falls by $20 billion(compared to the year before), but business firms continue to produce consumer goods at an unchanged rate. if there is no other cha
What would need to be added to the basic supply and demand model to accurately predict what people do whenthey aren't sure if the store will have the goods they wantin stock. What should the shortag
Suppose that you are the chiefeconomic advisor to the president of the U.S. You are asked topropose a strategy to bring the economy out of recession. Your goalis to avoid inflation and yet bring the
In Northlandia, there are no labor contracts; that is, wagerates can be renegotiated at any time. But in Southlandia, wagerates are set at the beginning of each odd year and last for twoyears. Why w
What are the short- and long-term economic benefits and costs associated with our current high federal government budgetdeficits Do you think the economic benefits outweigh the economiccosts, or not
In a country such as Japan that has had verylittle inflation in recent memory, it will take longer for a changein the actual inflation rate to be reflected in a correspondingchange in the expected i
What will happen tothe price of corn oil [3] How does theprice elasticity of demand for corn oil influencethe quantity-demanded of corn oil and theTotal Revenue earned by sellers of corn oil Explain
Suppose you were having lunch withyour best friend who just enrolled in an economics class. He was complaining about how irrelevant the class was, commenting that he saw no useful purpose for econom
If you travel around the world, you will see tremendous variation inliving standards of the people. The world's poor countrieshave average levels of income per person, that are less thanone-tenth th
Explain what factors would increase the supply (shift the supply line to the right) of a manufactured product like white bread and what factors would cause a decrease in demand (shift of the demand
Discuss the impact of changes in the size of the 18-24 age group on marketing strategy planning in the United States. What are some specific marketing strategies that result from this change
Explain how a firm's production function is related to its marginal product of labor, how a firm's marginal product of labor is related to the value of its marginal product, and how a firm's value o
if a government initially has a balanced budget but then cuts taxes, it is running a deficit that it must somehow finance. suppose people think the government will finance its deficit by printing th