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What real interest rate will be charged to the borrower if people are risk neutral? What can you say about the level of the real interest rate if people instead are risk averse?
Find a numerical equation linking planned aggregate expenditure to output. Find the autonomous expenditure and induced expenditure in this economy.
Indicate the quantity of GDP that will be produced during the period. How will the unemployment rate during the current period compare with the natural rate of unemployment?
Discuss some of the methodological and measurement problems one might encounter in using time-series data to estimate the parameters of this model.
Suppose that output can be sold for $10 per unit. Also assume that the firm can obtain as much of the variable input (L) as it needs at $20 per unit. Determine the marginal revenue product function.
Explain how the scope of monetary policy to lower interest rates becomes limited as the interest elasticity of money demand approaches infinity.
Assuming that the current production rates are maintained at the three assembly plants, which alternative should management select?
annual income would be about $30,000. Bowen can invest any funds that would be derived, if the farm were sold, to earn 10 percent annually. Compute Bowen's accounting profits.
Germany decline and other producer prices remain unchanged, what effect should these factors, by themselves, have on export trade, and why?
The purchase of a Boeing 747? Would Boeing's margin likely rise or fall if the yen then depreciated and competitor prices were unchanged? Why?
What steps could a domestic manufacturer like Cummins Engine Co. of Columbus, Indiana, take in advance to reduce the effect of the exchange rate fluctuation on company profitability?
What effect would a 30 percent reduction in the number of new homes completed have on Mapco's sales (ignore the impact of the price cut of the Surefire trimmer)?
If Frank is maximizing profits, what is the marginal revenue product of the last worker he hired? What is that worker's marginal product?
Calculate and graph the marginal cost of each pie. Show your calculations! Why does the MC curve have the slope (up, down, or flat) that it does?
Graph the demand curve for pecan pie. Does the demand curve have a positive or negative slope? Why? How many pies will Helen sell at $19.13? How many at $29.16?
What is the profit maximizing price and quantity of output for Ajax, assuming it is an unregulated monopoly? What are its profits?
Analyze a financial crisis (Asian crisis of 1997, or the Brazilian crisis of 1999, or the debt crisis of 1982) with regard to the causes of the crisis, behavior of lenders.
Show how the consumer's opportunity set changes if income increases by $400. How does the $400 increase in income alter the market rate of substitution between goods X and Y?
If the price level recently fell by 5% in Canada while increasing by 20% in Europe, how much must the x-rate change if PPP holds?
Which were the best and worst decades in terms of x-rate volatility? To answer this question, calculate the standard deviations for each available decade (e.g., the 50s, the 60s, etc.).
Calculate monthly changes and plot the new series. Does the magnitude of the changes in the index increase or decrease towards the end of the sample period?
If the CPI was 110 last year and is 121 this year, what is this year's rate of inflation? In contrast, suppose that the CPI was 110 last year and is 108 this year. What is this year's rate of inflat
Institutionalized, 120; not in labor force, 150; unemployed, 23; parttime workers looking for full-time jobs, 10. What is the size of the labor force? What is the official unemployment rate?
Decline in the size of the labor force? Why is a positive unemployment rate-one more than zero percent-fully compatible with full employment?
Find the equillibrium price and quantitiy that will prevail in the market. At a price of $10, would there be a surplus or shortage? if so, how much?