Question 1 There are three policy variables that the government and the Bank of Zambia control that have a major influence on the economy. Draw small sketch graphs and quick indications of the effects on Y and i of each variable moving both up and down while holding the other policy variables constant (i.e. there are six situations to consider). The first one is done for you as an indication of how to do the others: 1. Increase in G IS-LM Model IS Y increases LM, i increases IS: IS, Y
Q: the third unit should not be produced. the third unit should be produced. zero units should be…
A: Public good is defined as a good or service which can be utilized by each and every person of the…
Q: John is planning to retire in 15 years. Money can be deposited at 8% compounded quarterly. What…
A: Semiannually Withdrawal = 25,940 Interest rate = 8% compound quarterly
Q: Which point corresponds to level of consumption and investment in the economy after malinvestment…
A: Optimal choice - It is the best combination of goods which will lead to the best satisfaction of the…
Q: The present value of a sum of money is the amount that must be invested now, at a given rate of…
A: P = F(1+rn)ntwhere P is present worth F is Future worth n is compounding period t is time period In…
Q: Empirical Exercise 5.1 Suppose that the US inflation rate was at 7.6% in August 2018 and 8.1% in…
A: Answer - Philips Curve:- Philips curve is a curve which help establish relationship between…
Q: A) Ana decides every day how many hours to work and how much beef to consume. She spends all income…
A: Given information U=2t^0.5+Y W=1 t=24-h Y= consumption of beef Price of beef=4
Q: The figure below depicts the short-run market equilibrlum In a perfectly competitive market and the…
A: Perfect competition market is such market where there are very large number of buyers and sellers…
Q: explain why the centers of authority an indicator of a global city? give examples
A: Introduction The Global City Indicator initiative is indeed a fragmented, city-led initiative that…
Q: n general equilibrium, when one of the firms producing goods is a monopolist, it charges price that…
A: The monopolist is the single seller in the market of goods to a large number of buyers which large…
Q: Commercial banks hold governments bonds of £71, reserves of £61, and currency of E48. The public…
A: money multiplier = 1+cc+ rrwhere c is currency deposit ratio rr is reserve deposit ratio
Q: From 1980 to 2010, China achieved a rapid increase in per capita Real GDP by: lowering its…
A: The extraordinary greater part of China's exports comprises made merchandise, of which electrical…
Q: Which of the following mode of entry is best suited for a product that is bulky and involves…
A: In an economy, when an individual or a firm wants to sell its products, they requires to opt an…
Q: What goal of foreign policy is being achieved in the following example: US and UN troops oversaw…
A: Answer: In the given example US and UN oversaw the elections to ensure it was held in a fair manner.…
Q: In the market for euros, a Multiple Choice cause no change in equilibrium price. increase…
A: Exchnage rate is the rate at which the nations currency are exchanged . And it is determined by the…
Q: The multiplier effect is: a) A way of measuring population expansion b) A way to explain the…
A: The multiplier effect is the way of measuring the final change because of the initial change. Ex.…
Q: A company raises its cost per unit while also increasing its producer surplus per unit. Which of the…
A: A firm raises its cost per unit and also increases the producer surplus per unit. The consumer's…
Q: Capital investment Annual 0&M costs Electricity sales Decommissioning 50MW onshore €65M €40k per 2MW…
A: Given information Capital investment=65M for 50MW Annual expenditure=1M Annual revenue=8.2M Salvage…
Q: The Coronavirus, in March 2022, was the reason for a major shutdown of economic activity across the…
A: The economics as a study is based upon the basic idea of scarcity, where the resources which are…
Q: In 2020 the UK government introduced a sales tax on all products bought online from overseas. Please…
A: When the market's supply and demand dynamics balance, prices remain stable. Prices tend to fall when…
Q: i) In a free market, when the market price is above the equilibrium price, a surplus exists. Falling…
A:
Q: $43,000 31,000 $25,000 18,500 $11,000 $15,500 25,000 11,000 ne icon to view the interest and annulty…
A: Present worth is the idea that expresses a measure of cash today is worth more than that equivalent…
Q: Why is it important to study productivity? How do we determine productivity? Give an example of each…
A: It is basic to focus on effectiveness since it chooses the assumptions for ordinary solaces of…
Q: If there is an unrest in Turkey, and Turkish investors purchase U.S. securities, the Part 2 A.…
A: If there is unrest in the Turkish economy, the confidence of the investors will fall. So, they…
Q: 1. The market price for tomatoes is $2/pound. Lynn is to0 small to influence the price of tomatoes.…
A: A business's labor demand is the amount of labor hours it will hire in light of the many external…
Q: If Qd = 25 -5P and Qs = P. Then, the choke price is_______
A: Given: Qd = 25 - 5P Qs = P
Q: Social security in the U.S. is funded by government expenditures current and future taxes the…
A: Note:- Since we can answer only one question at a time, we'll answer the first one. Please repost…
Q: 2- Find Profit for the project, which its cash flow is shown below 95 x 10 700,000 U دفعات شهرية 0 0…
A: The total cash and cash equivalents received and expended by a company are referred to as its cash…
Q: Assume real per capita GDP in West Swimsuit is $8,000 while in South Darlinia it is $2,000. The…
A:
Q: What can a multi-national enterprise do to minimize its exposure to political risks in its host…
A: A multinational enterprise (MNE) and at times likewise called multinational company (MNC), simply…
Q: Using the above Lorenz Curve, answer the following questions. . . Approximately what percentage…
A: The Lorenz curve is a graphical representation of the distribution of income or wealth in a society.…
Q: why is optimal employment important in the production function
A: The production function depicts the technical association between the quantities of output (Q) that…
Q: the market for euros, a decrease in U.S. real interest rates tends to Multiple Choice decrease…
A: The equilibrium exchange is determined by the demand and supply for the foreign exchange.
Q: What is the difference between a patent and a trade secret?
A: Answer is given below
Q: Figure A *Price 100 90 - 80 + 70- 60 55 -- 50- 40 + 30 - 20 MC 10 + R D 10 1520 25 30 35 40 Quaxtity…
A: A Monopolist is the only seller of a specfiic good in a market who has an opportunity to perform…
Q: What is the definition of internal rate of return (IRR)? If you expect the annual interest rates are…
A:
Q: Suppose the aggregate demand and short-run aggregate supply schedules for an economy whose potential…
A: Recessionary Gap occurs when Real GDP is less than the Potential GDP. Due to recessionary gap,…
Q: Choose the three characteristics that best describe a sole proprietorship A unlimited liability B.…
A: Answer: A sole proprietorship is a type of business entity that is owned by a single person. It is…
Q: Explain the natural order hypothesis.
A: The natural order hypothesis proposes that infants learning their first language acquire grammatical…
Q: Combinations Rice Shoe A 50 0 B 45 1 C 37 2 D 27 3 E 15 4 F 0…
A: Answer: (C). Opportunity cost refers to the units of a good sacrificed in order to increase the…
Q: position about Salaries of uninformed personnel have to be the same with that of teachers and…
A: The pay and allowances are the basic cost that is incurred by any firm. But the salaries vary…
Q: Suppose that the money multiplier is originally equal to 3. However, due to lack of confidence in…
A: Money supply=monetary base * multiplier Suppose the monetary base is 100. then at 3 multiplier money…
Q: The government budget is in DEFICIT when OT G-Transfers (TR) - Interest on the Debt (INT) 0…
A: Dear student, you have asked multiple questions in a single post. In such a case, I will be…
Q: An increase in the government's budget deficit means Options: public saving is greater than $0 and…
A: A government is said to be in deficit when it's revenue is less than its spending. Such situation is…
Q: The “3 - 6 – 3” banking model broke down when inflation and money market interest rates spiked…
A: The 3-6-3 rule is indeed a slang word for an unofficial banking practice that emerged in the 1950s,…
Q: What we can conclude on the journal Methodology of Islamic Economics From Islamic Teachings to…
A: Economics solely relies on knowledge obtained through human thinking and perception of the world…
Q: 0.02q + 5q - 38 Suppose the Sunglasses Hut Company has a profit function given by P(q) where q is…
A: Profit Function : P(q)=-0.02q2+5q-38 (a) For Marginal Profit, we differentiate the profit function…
Q: A computer platform requires $270,000 initial investment and additional $60,000 after 10 years. The…
A: * SOLUTION :- Given that , Intial investment = $270000 Additional after 10 years = $60000…
Q: In the simple circular-flow diagram, who buys the factors of production
A: A simple circular flow diagram represents how dollars, inputs, outputs flow through the markets. The…
Q: Illustrate the main features of the Ricardian view of government deficit. Critically assess the…
A: Ricardian's view of government deficit illustrates that The consumers would tend to save and not…
Q: Cost function C = 80q - 3q2 + q3 If MC function is 80-6q+3q2, At what output level the average cost…
A: Answer to the question is as follows:
Step by step
Solved in 2 steps with 6 images
- Please no written by hand solution Consider a scenario of a closed economy in the short run where price level is fixed. Assume that bothtaxes and money supply increase in a way that keep output constant in equilibrium (suppose that themarginal propensity to consume is less than one). Which of the following may result from the policychange?a) It will lead to an increase in investment but a decrease in consumption.b) It will result in an increase in investment but a decrease in government spending.c) It will lead to an increase in investment and private saving.d) It will decrease investment but increase in public saving.1. Using the AS-AD model, graph and explain the effects of Covid-19 on the U.S. macroeconomy by comparing 2019 vs. 2020. Label the years on all curves, the axis, and the equilibrium. Ignore macroeconomic policy responses, such as the CARES act. Which curves shifted which direction, and why? 2. Now introduce any macroeconomic policy response. What curves shift which direction, and why? 3. What were the equilibrium quantities for both axis?Please no written by hand solution Consider the following economic situations:C = $4.0 trillionI = $1.5 trillionG = $3.0 trillionT = $3.0 trillionNX = $1.0 trillionF = 0mpc = 0.8d = 0.35x = 0.15r = 1% λ = 0.5A. Calculate an expression for the IS, MP and AD curves ( r= ?, IS Y= ?, AD Y=?)B. Let AS curve be given by the relation: π = 6 + 1.5 (Y - 25.5) (i.e. the price shock is zero). What are the equilibrium values of inflation, output and the real interest rate(π, Y, r)?C. Suppose government purchases are raised from $3.0 trillion to $3.5 trillion. What are new short-run equilibrium inflation values, output and the real interest rate (π, Y, r}?D. Suppose a financial crisis begins, and ƒ increases ƒ = 3. (Assume government purchases are again as in part (a). What are the new short-run equilibrium values of inflation, output, and the interest rate (π, Y, r}?(Please solve all the parts with numerical steps so it could be practiced easily)
- 1Why low rate inflation is considered necessary for economic grwoth? Oa It does not affect the purchasing power of wages Ob. It indicates that the currency is in continuous demand by the people Oc taffects only the rich and not the poor Od itact as an incentive to boost in supply in the economy 2When the economy is in Keynesian macroeconomic equilibrium, planned investment is greater than actual investment. O a False O b. True 3Government fixes the floor and ceiling price which will not allow the producers to increase the price on their wish, this is a type of. O a Physical control called price pegging O b. Monetary policy control measures O. Physical control called price tagging Od. Fiscal policy control measures O e None 4Rising output coupled with falling prices is called stagflation O a. False O b. True 5The Value of marginal propensity to consume lies O a. O to 1 O b. Less than zero Oc -1 to 1 Od. Between O to 1 6The Central Bank way to control inflation is Oa Monetary policy…The imaginary country of Harris Island has theaggregate supply and aggregate demand curves as Table24.3 shows. a. Plot the AD/AS diagram. Identify theequilibrium.b. Would you expect unemployment in thiseconomy to be relatively high or low?c. Would you expect concern about inflation in thiseconomy to be relatively high or low?d. Imagine that consumers begin to lose confidenceabout the state of the economy, and so ADbecomes lower by 275 at every price level.Identify the new aggregate equilibrium.e. How will the shift in AD affect the originaloutput, price level, and employment?Use the extended IS-LM model graph to show where the US economy is functioning now given that the current u is 7.9% and the full-employment (FE) u (aka un) is 4%. [Hint: if u > u FE then Y< Y FE.] Indicate the gap and provide its name. Let’s assume that a “second covid-19 wave” in December 2020 leads to more lockdowns, so that many more businesses struggle to survive and face an increase in their probability of bankruptcy. What is this “shock” and what would it do, cet. par., to your graph of part a.? Explain any shift(s). Let’s assume the Federal Reserve fixes the gap in your graph of part b. Provide appropriate name(s) and policy tools and show what will happen in your graph of part b. What role, if any, does the “zero lower bound” play?
- 6.1.What is an AD-AS model and what does such a model as per the givendiagram essentially focus on?6.2.Discuss the diagram in detail by first explaining what leads to step Step 1(representing a shift in curves on the diagram) and indicating what occursto cause shifts in some of the curves. Then discuss Step 2 (whichrepresents other macroeconomic changes) and indicate what happens toother variables when there are shifts in some of the curves as per Step 1. 6.3.What, in general, do the points of intersection between the AS and AS2curves and the AD curve show?6.4.When the LAS curve moves to the right to LRAS2, what exactly do thepoints of intersection between the AS and AS curves and the AD1 curve,indicated as point 1 and point 2, reflect on the diagram?Congratulationst You have been appointed an economic policy adviser to the United States, You are told that the economy is significantly abowe futtemplyoment GDP. Based on this inlormation, how can the economy would adjust to reach LR.SR Equilbrium (Classical View)? The economy wilt experience low unemployment rate, pushing wages up, and increasing the pelces of a key input (labor). shatting the sAS to the left (up). The economy will experience high unemployment rate, pushing wages down, and reducing the prices of a key input (labor). shiting the SAS to the right (down). The econoriny wil experience low unemployment rate, decreasing inceme, which will eventually shift the AD to the left. The eooncmy will experience low unemployment rate, pushing wages up, and increasing the prices of a key input (labor), shiting the sAs to the night (down).Suppose in the real business cycle model that there is a simultaneous temporary increase inboth current government spending and in the current money supply. Draw diagrams for thelabour, goods and money market, and the production function. Determine the equilibriumeffects of these two shocks occurring simultaneously on employment, output, consumption,investment, money, real wages, the real interest rate, and the price level. Provide a detailedeconomic analysis explaining your results with the aid of the diagrams.
- Course: Macroeconomic - IS-LM Model Prove mathematically the following: Given an increase in the proportional tax on income(t), what happens to the level of output and to the tax?" . Hint: for demostration, use the IS general function for a closed economy Y = C + I + G, where C = a + c*YD and YD = Y + TR - Y*t (where t = proportional income tax) and realize changes i.e., from "t1" to "t2"Suppose that in Macroland the consumption and the investment have a negative relationship withthe real interest rate and positive relationship with Y. The Central Bank of the country targets acertain nominal interest rate and lets the money supply adjust in order to reach that interest rate.a. Draw a graph of the IS-LM model in this situation.b. Suppose that the Central Bank announces an increase of the interest rate in the future.Represent graphically the initial position of IS-LM curves. Then, show the IS-LM curves of thefuture, after the announced increase in the interest rate is implemented. (Assume that the ISis constant.).c. Suppose that agents today take into consideration the resulting income of the future whendeciding the amount of consumption and investment. Show what happens to the IS-LMcurves today after the announcement of the CB (tip: the CB is NOT increasing the nominalinterest rate today).d. The government decides to step in and avoid any deviation of Y from the initial…i neeed it in word form.. not handwrittten Explain, with the aid of three separate IS-LM-FE diagrams, how a decrease in government purchases will affect real output, real interest rate and the general price level in three steps:(i) before the general price level adjusts;(ii) when the general price level is adjusting;(iii) after the price adjustment process is completed.Is the general price level increasing or decreasing during the price adjustment process? Explain the intuition of your answer with reference to the AD-AS framework.