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Derive the equation for the IS curve. Compute the equilibrium interest rate and the real output. Compute the new equilibrium interest rate and the real output.
If the Fed took no action, what would happen to interest rates? If the Fed wants to keep the interest rate stable, explain and show graphically how the Fed can ensure that this.
Use (P-MC)/P = 1/ l e l to calculate MC and then use the same equation to find out the new price. l e l is the absolute value of demand elasticity.
Calculate the cross -price elastcity of demand Given the elasticity you calculated, did it make sense for supermarket to raise it's price?
Total soft drink demand increased, and Pepsi took a larger share of the demand. Why is the equilibrium of this game different from that of a prisoners' dilemma?
What performance percentage would you use to trigger executive bonuses for that year? Why? What issues would arise with hiring and retaining the best managers?
Explain the impact of this additional patient on the SAVC and SATC. Where are economies of scale demonstrated along the curve? Show.
Suppose a third project will cost $20,000 today and yield a return of $2,500 a year indefinitely. What is the present value of the project? What is the present value if the interest rate increases
At what level of output will the average variable cost be at a minimum> What is the minimum average variable cost?
How much does it cost to produce 100 litres of juice? Does the complete process exhibit constant, increasing or decreasing returns to scale? Hint: If you double all inputs (S, L and H) what happens
What are its short run and long run average cost functions (average cost as a function of output)? Explain the general nature of the relationship between short run and longrun average cost curves.
What are the average fixed (AFC) and average variable cost functions (AVC) and average cost(AC) functions? Write down their algebraic form and graph them.
Write the cost of production, C, as a function of A for each of the two locations. In which city should you locate the plant to minimize your cost per unit of output?
In 2009 Circuit City closed its stores. If we assume this was a short run decision, then the most likely explanation for it is that the price of a typical product sold at Circuit City stores was?
labor force: 154,287,000; employment: 145,362,000; working-age population: 233,788,000. calculate the unemployment rate.
Why is the outcome in a) not desirable? Which policy (monetary or fiscal) would be more appropriate to improve the situation. Explain your choice clearly using diagrams to show the effect of both po
Discuss briefly what kind of exchange rate system you would recommend for a small country ina integrated global economy ( with capital mobility): fixed or flexible.
What is the short run impact of a temporary fiscal expansion under fixed exchange rates? Would the short run impact of a permanent fiscal expansion be different?
Write the new balance sheet of the central bank. What happens to the money supply as a result of this action? What should the bank do to sterilize this effect on the money supply
A firm with a U-shaped average cost curve finds that its costs exceed its revenues when it sets price equal to marginal cost. On which part of its average cost curve is the firm operating?
Transformed into fixed capital goods, new technology, and cost reduction using new methods of production. Also, explain how interest rates impact the availability of investment capital.
The supply of loans is r=2+i. if the real interest rate is equal to 3%, then what is the expected rate of inflation in the nation?
Write a paper analyzing different approaches that might be used by Keynesian theorists and 2) monetary theorists to promote long-run macroeconomic stability.