a borrower cannot become a saver if the rate of interest decreases, but might become a saver if the rate of interest increases. is this true or false? carefully explain your answer (which must prove or disprove each part of the statement)
Q: Q2. The economist for the ABC Truck Manufacturing Corporation has calculated a production function…
A: We have Production function: Q=1.3L0.75K0.3 .... (1) Also Labor Capital 100 50…
Q: b) Suppose a business faces a production function which is of the Cobb-Douglas form: Q(L, K) = ALªKB…
A: We have cobb double production function with alpha and beta as parameters.
Q: If college-age athletes drop out of college to play professional sports, principle # is the…
A: The cost of the another best alternative that is foregone is referred to as opportunity cost. It is…
Q: In IS-MP model what variable is on horizontal axis? If IS-MP have different variable on horizontal…
A: IS that is an investment and saving is a downward sloping curve, this curve shows that with an…
Q: What type of good is rival and nonexcludable? O private goods club goods O common resources public…
A: Non-excludable goods are defined as those goods in which people cannot be excluded from their…
Q: there are 4,000 people that commute into a city each day. There is a local road that takes 30…
A: The Nash equilibrium is a dynamic hypothesis inside game theory that expresses a player can…
Q: 3 1. A consumer has the utility function U(x,y) = 2x y where x and y represent the quantity consumed…
A:
Q: Question 29 Approximetley, how many public companies are listed on all the US exchanges?…
A: In their search for profit, stock market investors have a vast range of alternatives and tactics, as…
Q: The US was #1 in math and science education in the 1960s, but now ranks: O outside the top 10 in…
A: Ranking means position on scale.
Q: Chose the trrue statement. a. Sincce the mid 1800ss , Unitedd States of America has experienced…
A: The answer is - c. The Clarrk-Fisher hypothhesis implies that as productivity increases in one…
Q: The following table contains different consumers' values for three software titles: PowerPoint, Exc…
A: Price blend is the mix of various 'prices not entirely settled by a maker to fix the price of the…
Q: 2).Do you think it likely that attempts to reduce income inequality would reduce people's incentives…
A: 2) Economic inequality is defined as the gaps in wealth and income that exist in a society. Apart…
Q: Y S G X-IM 935 -250 320 40 70 2,100 320 140 40 3,220 250 320 200 -150 4,800 375 320 240 -185 5,320…
A: Equilibrium in the economy occurs where aggregate expenditure is equal to production.
Q: A price taking firm has zero fixed cost and increasing marginal cost. What quantity does it produce?…
A: A price-taking firm is a perfectly competitive form that exists in a perfect competition market…
Q: Scholars have identified many different broad “types" of interest groups. Which type can best be…
A: Today, there are so many organised lobbyists. They representing all parts of society and addressing…
Q: According to Adam Smith money can be compared to our High Way System. Describe it?
A: Adam Smith was an economist who is known as the 'father of modern economics' due to his work in 'The…
Q: 12. Regulation of a Natural Monopoly For a decreasing-cost industry natural monopoly (LRAC…
A: Monopoly can be defined as the market structure that can be characterized by one seller who is…
Q: Explain the economic basis for international business.
A: Meaning of Economics: The term economics refers to the situation under which there remain…
Q: Continuing to refer to Table 7.9 and Figure 7.7, compute the average total cost, average variable…
A: * SOLUTION :- Given that ,
Q: Which of the following events would contribute to economies of scale? O Large supermarkets being…
A: Economies of scale refers to decrease in average cost as production increases.
Q: If taxes depend on income and the MPC is 0.8 and tis 0.4, the tax multiplier is Select one: O a.…
A: Given: The MPC is = 0.8 The tax T is = 0.4 To Find: The tax multiplier:
Q: 1. The following data are price/quantity/cost combinations for Titan Industry's mainframe computer…
A: Quantity total revenue marginal revenue Profit marginal cost 0 0 0 (2,00,000) 2,00,000 1…
Q: 6) If a 10 percent increase in the quantity of spinach demanded results from a 20 percent decline in…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: a) If a business has a long-run cost (TC) function given by TC = aq^3 – bq^2 + ca where q = the rate…
A:
Q: Which is the correct answer ? Suppose there are 10 apples and 10 oranges in the economy. Joe is…
A: The correct answer is - A. A decrease in the orange price relative to the apple price.
Q: Define the term economic community.
A: A group of countries agrees to significantly reduce or eliminate trade barriers among member…
Q: One of the main objectives for firms is profit maximization. (a) Explain, using diagrams, how…
A: Firms working in the market targets maximize the profit. Market structure is classified on the basis…
Q: Consider a competitive firm that has access to a technology described by the following production…
A: y = √x1 + x2 Checking for constant returns to scale: y = √ax1 + ax2 y = (a)0.5x1 + ax2 We cannot…
Q: Which of the following is not an automatic stabilizer. Pick a,b,c, or d A) Sales tax B)State…
A: Automatic stabilizer brings the economy back to full employment.
Q: Reference the cash flows shown below. Pick the best alternative using the ERR method. MARR = 15%. e=…
A: The Economic Rate of Return is defined as the rate calculated from the Cashflow of an investment,…
Q: employee in the labour discipline model? O The game is a simultaneous game in which the employer…
A: The wage theory held that wages relied upon the general measures of capital accessible for the…
Q: The daily demand for movie rental from a movie theatre operator Silver Screen is given by the…
A: Revenue maximization is a theoretical goal of a company that aims to sell at a price that maximizes…
Q: (b) An investor's utility function is given by: U(w) = In(w 2 ) where w is the investor's level of…
A: U = ln(w2)
Q: Determine the unique Nash equilibrium by eliminating dominated strategies
A: Player 2 E F G A 2,3 2,2 2,0 Player 1 B 3,2 5,3 4,3 C 4,3 1,1 3,3 D 1,2…
Q: Consider the labour market of Novindus characterised by the following: Firms markup over cost = 8%…
A: Hi! Thank you for the question, As per the honor code, we are allowed to answer three sub-parts at a…
Q: Economics Question
A: A fixed exchange rate refers to when the central authority of a country ties the value of its own…
Q: drawing on Portes (2022) and Sumption ,Discuss the available tools to address labour shortage…
A: A labor shortage occurs when a sufficient number of adequately competent, qualified, trained, and…
Q: 1) A given change in quantity demanded caused by a proportional change in price is called: Unit…
A: Price and quantity demanded are inversely related. Change in price and quantity demanded move in…
Q: Economics what is the EUAC corresponding to an overhaul cost of 4000 at year 3 for a machine with 7…
A: Overhaul Cost = at 3rd Year = 4000 n = 7 years r = 8%
Q: (a) Suppose the government of a country has run large budget deficits for several years in attempt…
A: When government raises its budget deficit in order to increase output, it leads to a rise in the…
Q: What is the marginal cost, if the cost function given is C(Y)=6 a) Y? b) 3Y c) 6Y d) 12Y
A: Marginal cost refers to an additional cost that occurs from producing one more unit of output.
Q: (i) Explain the relationship between the current account balance given by exports (X) minus imports…
A: Since you have posted multiple questions, we will answer the first question for you. If you want any…
Q: In a perfectly competitive labor market, a profit maximizing firm will hire labor up to the point at…
A: A firm will maximise profit at a point where marginal revenue is equal to marginal cost.
Q: Macy's was selling Calvin Klein jean shirts that were originally priced at $46.00 for $8.74 a. What…
A: A markdown is an amount by which one decrease the selling price.
Q: If you worked on a "macro level" within Human Services, what are some changes you would try to…
A: Macro-level human services will create an effect on a large scale, it will provide solutions on a…
Q: f money is worth 5% per year, would it be a good investment to spend $100,000 for a new food…
A: Given: Interest rate=5% Initial spending=$100000 Saving=$12000 Number of years=7
Q: MC = 20 + 3Q ontinuing Note: MR = 80 – 4/3Q = 80 – Q – ½Q = P – ½Q = P- (dP/dQ)Q = P(1 - 1/ED) %3!…
A: Monopoly can be defined as the market structure that can be characterized by one seller who is…
Q: he elasticity coefficient for a relatively elastic or simply elastic demand curve, is"…
A: Elasticity of demand measures the responsiveness of quantity demanded with respect to change in…
Q: eets when requested. Qs1 is the quantity supplied thout social costs. Qs2 is the quantity supplied…
A: A negative externality is a cost borne by a third party. For instance, the noise of a trumpet gives…
Q: gd A and good b: perfect compliment i buy $80 on good a and b monthly the pricing of the 2 gds are…
A: Given Good a and good b are perfect complements to each other. Consumer monthly income = $80 Price…
a borrower cannot become a saver if the rate of interest decreases, but might become a saver if the rate of interest increases. is this true or false? carefully explain your answer (which must prove or disprove each part of the statement) using any appropriate diagrams
Step by step
Solved in 2 steps with 1 images
- Briefly discuss THREE economic policies that encourages household savings.This question addresses the impact of saving on an economy by examining what happens if tax laws change to induce saving and how changes in tax laws can discourage saving. The following graph shows the market for loanable funds. Show the impact of a change in the tax law that successfully encourages saving by shifting either the demand curve (D), the supply curve (S), or both. A tax law change that successfully encourages saving will (increase/decrease) interest rates, which leads to (less/more) investment and economic growth. To better understand how changes in tax laws can affect saving, suppose that Madison, a rising third-year in college, plans to save $550 from her summer job in order to buy textbooks for the upcoming fall semester. Madison's parents are so impressed with her plans that they offer to pay her an additional 30% interest per month on the money she saves, which means that Madison is now earning a large rate of return on her saving. By the end of the…Scenario 1: Suppose savers either buy bonds or make deposits in savings accounts at banks. Initially, the interest income earned on bonds or deposits is taxed at a rate of 20%. Now suppose there is an increase in the tax rate on interest income, from 20% to 25%. Shift the appropriate curve on the graph to reflect this change. This change in the tax treatment of interest income from saving causes the equilibrium interest rate in the market for loanable funds to Fall/Rise and the level of investment spending to decrease/Increase Scenario 2: An investment tax credit effectively lowers the tax bill of any firm that purchases new capital in the relevant time period. Suppose the government implements a new investment tax credit. Shift the appropriate curve on the graph to reflect this change. The implementation of the new tax credit causes the interest rate to Fall/Rise and the level of investment to Fall/Rise . Scenario 3: Initially, the government's budget is…
- Scenario 1: Suppose savers either buy bonds or make deposits in savings accounts at banks. Initially, the interest income earned on bonds or deposits is taxed at a rate of 20%. Now suppose there is a decrease in the tax rate on interest income, from 20% to 15%. Shift the appropriate curve on the graph to reflect this change. This change in the tax treatment of saving causes the equilibrium interest rate in the market for loanable funds to and the level of investment spending toIf consumers decide to increase saving, then C decreases, r decreases, I increases, and Y:Financial institutions have warned that increased life expectancy means that many people have not saved enough for their retirement. If true, what will the consumption path of these people look like as they reach their retirement years? Will this consumption path be smooth? And how will an increase in investment demand change the equilibrium interest and quantity of savings? Use a graph for the loanable funds market.
- Demand Supply Supply Demand LOANABLE FUNDS (Billions of dollars) Scenario 1: Suppose savers either buy bonds or make deposits in savings accounts at banks. Initially, the interest income earned on bonds or deposits is taxed at a rate of 20%. Now suppose there is an increase in the tax rate on interest income, from 20% to 25%. INTEREST RATE (Percent)5. The market for loanable funds and government policy The following graph shows the loanable funds market. For each of the given scenarios, adjust the appropriate curve on the graph to help you complete the questions that follow. Consider each scenario separately by returning the graph to its starting position when moving from one scenario to the next. (Note: You will not be graded on any changes you make to the graph.) INTEREST RATE (Percent) Demand LOANABLE FUNDS (Billions of dollars) Supply Demand SupplyCan a borrower become a saver? Explain using a diagram.
- What is the impact of a change in the savings rate on the output?Three students have each saved $1,000. Each has an investment opportunity in which he or she can invest up to $2,000. Here are the rates of return on the students' investment projects: Student Alex Clancy Eileen Return (Percent) 4 7 Student Alex Clancy Eileen 15 Assume borrowing and lending is prohibited, so each student uses only personal saving to finance his or her own investment project. Complete the following table with how much each student will have a year later when the project pays its return. Money a Year Later (Dollars) Now suppose their school opens up a market for loanable funds in which students can borrow and lend among themselves at an interest rate r. A student would choose to be a lender in this market if his or her expected rate of return is than r.Again, the following graph depicts the market for loanable funds. An investment tax credit effectively lowers the tax bill of any firm that purchases new capital in the relevant time period. Suppose the government repeals a previously existing investment tax credit. Shift the appropriate curve(s) on the following graph to show the impact of this policy. INTEREST RATE (Percent) pemand Supply QTY OF LOANABLE FUNDS (Billions of dollars) The repeal of the previously existing tax credit causes the interest rate to and the level of investment to
