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... • The firm has TR of $100 an uses $80 of labor. • Profit = $20. What happens in the LONG-RUN if price level doubles? • Now TR=$200 •In the LONG RUN workers demand higher wages to match prices. So labor costs double to $160 • Profit = $40, but REAL profit is unchanged. If REAL profit doesn’t change t ...
... • The firm has TR of $100 an uses $80 of labor. • Profit = $20. What happens in the LONG-RUN if price level doubles? • Now TR=$200 •In the LONG RUN workers demand higher wages to match prices. So labor costs double to $160 • Profit = $40, but REAL profit is unchanged. If REAL profit doesn’t change t ...
Sample questions for Test 1
... B) stagflation occurs when expected inflation is below actual inflation C) stagflation occurs when the short-run Phillips curve shifts left D) the inflation rate is equal to the real output growth rate plus the monetary growth rate 16. Wages are considered to be sticky rather than flexible since A) ...
... B) stagflation occurs when expected inflation is below actual inflation C) stagflation occurs when the short-run Phillips curve shifts left D) the inflation rate is equal to the real output growth rate plus the monetary growth rate 16. Wages are considered to be sticky rather than flexible since A) ...
Practice Test - MDC Faculty Web Pages
... if the marginal cost of the movie exceeds its marginal benefit. if the marginal benefit of the movie exceeds its marginal cost. if your income will allow you to buy a ticket. because movies are enjoyable. ...
... if the marginal cost of the movie exceeds its marginal benefit. if the marginal benefit of the movie exceeds its marginal cost. if your income will allow you to buy a ticket. because movies are enjoyable. ...
- Allama Iqbal Open University
... Q.4 Critically evaluate the implications in the process of deposit expansion and contraction. ...
... Q.4 Critically evaluate the implications in the process of deposit expansion and contraction. ...
3.2.2.2 Aggregate demand and aggregate supply analysis
... exchange rate if products are imported - Government regulation or intervention, such as environmental laws and taxes, and business regulation. Business regulation is sometimes called ‘red tape’. ...
... exchange rate if products are imported - Government regulation or intervention, such as environmental laws and taxes, and business regulation. Business regulation is sometimes called ‘red tape’. ...
Economics 342 Heckscher-Ohlin Mr. Easton only
... 1. Explain why constant factor prices imply constant factor proportions. 2. Explain why constant commodity prices imply constant factor prices. 3. In the Heckscher-Ohlin model, explain why, with relative commodity prices constant, an increase in the stock of labour will increase output more than pro ...
... 1. Explain why constant factor prices imply constant factor proportions. 2. Explain why constant commodity prices imply constant factor prices. 3. In the Heckscher-Ohlin model, explain why, with relative commodity prices constant, an increase in the stock of labour will increase output more than pro ...
Microfounded Macro:Graphical Illustrations
... Active role by government can mitigate deficiency in private demand(consumption and investment). Positive role of fiscal policy and monetary policy. Multiplier effect of demand on output Aggregate supply is horizontal in the short run. Animal spirits – importance of expectations. Lecture 2 ...
... Active role by government can mitigate deficiency in private demand(consumption and investment). Positive role of fiscal policy and monetary policy. Multiplier effect of demand on output Aggregate supply is horizontal in the short run. Animal spirits – importance of expectations. Lecture 2 ...
Fuel is the airlines` highest single cost item, some
... Pentelow & Scott (2011): aviation policy, Caribbean Goessling et al. (2008): developing countries ...
... Pentelow & Scott (2011): aviation policy, Caribbean Goessling et al. (2008): developing countries ...
Where do we Go from Here?
... mean standard neoclassical microeconomics, and no empirical evidence, that markets with fully rational agents are intrinsically robust in the face of shocks. Nor is there any evidence that the central actors in the financial sector have been in any way irrational. How do we explain this curious situ ...
... mean standard neoclassical microeconomics, and no empirical evidence, that markets with fully rational agents are intrinsically robust in the face of shocks. Nor is there any evidence that the central actors in the financial sector have been in any way irrational. How do we explain this curious situ ...
Econ 2 UT2 F16 - Bakersfield College
... B. Now imagine that the situation is the same, but before any pizzas are bought, both the incomes and the price of pizza doubles. Now how many pizzas will both people buy? ...
... B. Now imagine that the situation is the same, but before any pizzas are bought, both the incomes and the price of pizza doubles. Now how many pizzas will both people buy? ...
File
... services (real GDP) that firms will produce in an economy at different price levels. The supply for everything by all firms. Aggregate Supply differentiates between short run and long-run and has two different curves. Short-run Aggregate Supply •Wages and Resource Prices will not increase as price l ...
... services (real GDP) that firms will produce in an economy at different price levels. The supply for everything by all firms. Aggregate Supply differentiates between short run and long-run and has two different curves. Short-run Aggregate Supply •Wages and Resource Prices will not increase as price l ...
Economics 3307
... AD is not met with a fully compensating change in P (thereby keeping the economy on LRAS) because economic agents are not fully aware of what is going on. This formulation has the interesting implication that effect on Y of changes in AD depends on the extent to which the change in AD is accurately ...
... AD is not met with a fully compensating change in P (thereby keeping the economy on LRAS) because economic agents are not fully aware of what is going on. This formulation has the interesting implication that effect on Y of changes in AD depends on the extent to which the change in AD is accurately ...
Free Enterprise System
... the other good Complements are goods that are related in such a way that an increase in the price of one leads to a decrease in the demand for the other ...
... the other good Complements are goods that are related in such a way that an increase in the price of one leads to a decrease in the demand for the other ...
Unemployment Rate
... Changes in the overall price of the CPI market basket Shows the percentage increase in the average price of the economy’s goods and services Occasionally may show periods of deflation – a period of decreasing prices Is due to demand being sluggish and occurs when consumer spending is declining ...
... Changes in the overall price of the CPI market basket Shows the percentage increase in the average price of the economy’s goods and services Occasionally may show periods of deflation – a period of decreasing prices Is due to demand being sluggish and occurs when consumer spending is declining ...
Gross Domestic Product
... make or do themselves • Underground economy: black market, illegal gambling, selling a car to a friend, etc. • Negative externalities: value of clean environment not counted in GDP • Quality of life: additional goods and services to not necessarily make people any happier ...
... make or do themselves • Underground economy: black market, illegal gambling, selling a car to a friend, etc. • Negative externalities: value of clean environment not counted in GDP • Quality of life: additional goods and services to not necessarily make people any happier ...
Inflation Notes
... During the hyperinflation, German workers would be paid in three shifts during the day. For example, after working the morning shift, workers would race to spend their fresh salary, which would be worthless within another few hours. There are pictures of children building play forts with bricks of w ...
... During the hyperinflation, German workers would be paid in three shifts during the day. For example, after working the morning shift, workers would race to spend their fresh salary, which would be worthless within another few hours. There are pictures of children building play forts with bricks of w ...
AP Macroeconomics
... Cyclical-Caused by a recession, this is all unemployment below full-employment. Expansionary policy targets this. Seasonal-Freebie. ...
... Cyclical-Caused by a recession, this is all unemployment below full-employment. Expansionary policy targets this. Seasonal-Freebie. ...
Commodity price increases: causes, effects and policy responses
... resilient areas and marginal sources • Increased frequency of extreme events ...
... resilient areas and marginal sources • Increased frequency of extreme events ...
Economics 12_Ch.10_lesson 1
... If Canada has an annual inflation rate of 3%, are all the prices rising? Inflation does not mean all the prices are rising. Some prices are rising, while other prices constant or even decrease. It is that OVERALL prices are rising in 3%. ...
... If Canada has an annual inflation rate of 3%, are all the prices rising? Inflation does not mean all the prices are rising. Some prices are rising, while other prices constant or even decrease. It is that OVERALL prices are rising in 3%. ...
Unpublished mathematical appendix
... The approximation is made around the level of output Yj = Ȳj for each j and the mean values for the exogenous shocks. Here Ȳj = Yjopt represents the level of output in an optimal steady state; it is the level of output in an equilibrium with flexible prices and the optimal tax rate τ opt . We only ...
... The approximation is made around the level of output Yj = Ȳj for each j and the mean values for the exogenous shocks. Here Ȳj = Yjopt represents the level of output in an optimal steady state; it is the level of output in an equilibrium with flexible prices and the optimal tax rate τ opt . We only ...
Options for Organizing Small and Large Businesses
... Demand curve - shows the amount of a product buyers will purchase at different prices. Driven by variety of factors such as competition, price, larger economic events, and consumer preferences. ...
... Demand curve - shows the amount of a product buyers will purchase at different prices. Driven by variety of factors such as competition, price, larger economic events, and consumer preferences. ...