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An economy is operating with output $400 billion below its natural rate, and fiscal policy-makers want to close this recessionary gap. The central bank agrees to adjust the money supply to hold the
Ipads and laptops are substitutes. Use a supply and demand to show what happens to price, quantity, consumer surplus, and producer surplus in the market for laptops (after a technological advance ha
Suppose the government decides to increase taxes by $30 billion in order to increase Social Security benefits by the same amount. How will this combined tax-transfer policy affect aggregate demand a
Suppose that in the Akerlof example, there are only eight cars ranging in quality from 1/4 to 2 ( there is no complete lemon). Hence, the mean quality level is 1.25. Determine whether the market dis
"I see that your shoes are ‘buy one, get one free - limit one free pair per customer.' Will you sell me one pair for half-price" The clerk answered, "I can't do that." When the customer starte
1.-What are the short- and long-term economic benefits and cost associated with our current high federal government budget deficits 2.-Do you think the economic benefits outweigh the economic cost, w
One of the partners favors moving downtown because she believes the additional business gained by moving downtown will exceed the higher rent at th downtown loaction plus the cost of making the move
Suppose the Reserve Bank of Australia (RBA) observes directly aggregate demand shocks or fully anticipates them. Formulate a monetary policy rule that would insulate the economy from aggregate deman
explain that investment can be increased both by reducing taxes on private savings and by reducing the government budget deficit A) Why is it difficult to implement both of these policies at the same
Edision Electric Company's president has been arguing that residential electric rates need to be raised relative to industrial rates. His reason is that the rate of return that company earns on its
Henry, a resident of Nevada, sued Adam, a resident of Utah in the Federal Court in California. He sought $60,000 damages for personal injuries arising from an automobile accident that occurred in Lo
One critical aspect of the skills that managers lack is planning. You have been asked by your manager to conduct a preliminary search of recommending the two most common types of contemporary planni
Currently, it is difficult to sue the federal goverment unless it agrees to be sued. If the law were changed so that lawsuits (such as by victims of the collapse of the I-35W bridge) were easier, ho
In effect, the CRA and the actions of Fannie Mae and Freddie Mac acted to subsidize home purchases by people who otherwise would not have purchased houses. All subsidies must be financed by taxes, i
Draw a graph of aggregate demand and aggregate supply to illustrate the current situation. Be sure to include the aggregate demand curve, the short run aggregate supply curve and the long-run aggreg
Three students have each saved $1000. Each has an investment opportunity in which she can invest up to $2000. Here are the rates of return on the students' investment projects: Minji: 5% Yanrong: 8%
In the market in which David and Ellen have rent-controlled apartments, Ellen gets an apartment and Charlie does not. In the market with no price controls, the situation is reversed. Charlie gets an
The text presents the target rate of unemployment as being about 5 percent. William Vickrey, a Noble Prize winning economist, argued that the target unemployments rate should be seen as being betwee
• Identify an industry that the Internet has transformed or destroyed. • Then think of a new industry that the Internet has created. • What are the reasons behind the changes
Which variables are included and how are they combined What are the Millennium Development goals Who established them What are the targets for poverty and hunger and which regions are "off track" fo
Courts in Japan have recently begun to make awards to the families of workers who have been judged to have been "worked to death." That is, employers have been increasingly required by courts to mak
The clerk answered, "I can't do that." When the customer started to leave the store, the clerk hastily offered, "However, I am authorized to give you a 40 percent discount on any pair in the store.
The local government of singapore is concerned about increasing rental costs for residents, and decides to impose a ceilong price on the maximum rents that can be charged by landlords on apatments a
The government is considering increasing the tax on gasoline by $3 per gallon and has asked you to determine the impact on Janet's consumer surplus. Janet spends 5% of her income on gasoline and her
Using supply and demand analysis, explain why improvements in farm technology may not necessarily be good for the individual farmers. Assume that the individual farmers are selling a crop that has f