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Why the income and interest sensitivities of the demand for real balances affect the slope of LM curve?
Today the world population is almost 8 billion about 4 times of what it was a century ago. At the same time many people are enjoying a much higher standard of living than what did their grandparents. A perennial debate concerns whether this growth in population and standard of living can continue in the future.
Many commentators have argued that natural resources will eventually limit how much the world economies can grow. At first this argument might seem hard to ignore. If the world had a fixed supply of non-renewable natural resources, how can production, population and standard of living continue to grow over time. Won’t supplies of oil and minerals start to run out? When shortages start to occur, wouldn't they limit economic growth and force standards of living to also fall?
Most economists argue that technological advances often yields ways to avoid these limits. Discuss some of these ways.
What evidence in the market indicates that natural resources are not limiting economic growth?
With the help of a diagram, explain why demand for money is interest elastic
2.Which of the following will bring about an inward shift of the production possibility curve?
Select one:
a. An increase in the level of unemployment.
b. An increase in the allocation of resources to the production of capital goods.
c. A decrease in the demand for goods and services.
d. An increase in the number of skilled people emigrating.
e. A, B and C could all be associated with an inward shift of the ppc.
2.Which of the following will bring about an inward shift of the production possibility curve?
Select one:
a. An increase in the level of unemployment.
b. An increase in the allocation of resources to the production of capital goods.
c. A decrease in the demand for goods and services.
d. An increase in the number of skilled people emigrating.
e. A, B and C could all be associated with an inward shift of the ppc.
(a) Find the Nash Equilibrium for the following strategy
Column
Row Up Down
(b) Consider the following game matrix
Left 2, 4 6, 5
Right 1, 0 4, 2
Right
c, d g, h
PLAYER A
Top Bottom
PLAYER B
Left
a, b e, f
If (top, left) is a Nash equilibrium, then which of the above inequalities must be satisfied
How do Keynesians and classical differ in their beliefs about how long it takes the economy to reach long-run equilibrium? What implications do these differences in beliefs have for Keynesian and classical views about the usefulness of antirecessionary policies? About the types of shocks that cause most recessions?
It is sometimes argued that economic growth that is “too rapid” will be associated with inflation. Use AD–AS analysis to show how this statement might be true. When this claim is made, what type of shock is implicitly assumed to be hitting the economy?
Explain the horrad donor growth model and provide a discussion indicating if the theory will be applicable in developing countries like South Africa
According to the Random-Walk Hypothesis of Consumption under Uncertainty, individuals don’t need to optimise their consumption over time since the consumption is totally unpredictable” True or False? Note that you need to discuss according to the model
