Using the ZZ/Y and NX graphs, illustrate graphically and explain what effect an increase in taxes will have on output, exports, imports, and net exports. Clearly label all curves and clearly label the initial and final equilibria
What will be an ideal response?
An increase in T will cause a reduction in C and cause ZZ to shift down as demand falls. Y will fall causing a reduction in C and S. As Y falls, imports will fall. Given that exports do not change, net exports will increase.
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Frank Murphy is considering how many snowmobiles to purchase for his snowmobile rental business. Below are his estimates of the number of snowmobile rentals per year, depending on the number of snowmobiles available.Number ofSnowmobilesYearlyrentals1902170324043005350After paying all non-interest expenses, expenses Frank expects to net $10 per rental. Each snowmobile costs $15,000. How many snowmobiles should Frank purchase if the real interest rate is 4.5%?
A. 4. B. 0. C. 2. D. 1.
Which of the following has been the most likely effect of the Fed's credit policy?
A) Banks and other financial institutions have taken more time to recover from the 2008-2009 financial meltdown. B) The scope of asymmetric information problems in the banking industry has reduced. C) The money multiplier and the link between the money supply and the economy have become unstable. D) The federal funds rate and the discount rate have dropped to negative levels.
Ronald McDonald Houses is an example of
A) altruistic corporate social responsibility. B) reduction in shareholder value. C) vertical integration. D) strategic corporate social responsibility.
Which of the following is NOT among the proposals for reducing the Social Security financing gap?
A. Mandating larger payments from company pension plans B. Raising Social Security payroll taxes C. Privatizing the system D. Reducing benefits