Assess the validity of the following statement: In the Mundell-Fleming model, the domestic goods-market equilibrium curve is negatively sloped.
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Assess the validity of the following statement: In the Mundell-Fleming model, the domestic goods-
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- Describe the main differences between partial and general equilibrium analysis in the context of examining tax incidence.Is the rational actor model the best way to understand foreign policy decision-making? Define the model, indicate why it is used, and define any other relevant concepts. Raise an objection to the model. Reply to your objection, or raise a second objection. In your answer, be sure to define “rationality” and discuss important (and relevant) concepts as they relate to the Russian decision to invade Ukraine. Approximately 500- 700 words.Is the rational actor model the best way to understand foreign policy decision-making? Define the model, indicate why it is used, and define any other relevant concepts. Raise an objection to the model. Reply to your objection, or raise a second objection. In your answer, be sure to define “rationality” and discuss important (and relevant) concepts as they relate to the Russian decision to invade Ukraine.
- What are the values of P1,P2,Q1,Q2P1,P2,Q1,Q2 given the two commodity demand and supply model: Qd1=24−8P1+2P2Qs1=−6+12P1Qd1=24−8P1+2P2Qs1=−6+12P1 Qd2=28+P1−8P2Qs2=−6+2P2Qd2=28+P1−8P2Qs2=−6+2P2Question 3 Krugman Model: Suppose that the elasticity of substitution between vari- eties of a differentiated good is o = 3. The marginal cost of production is c = 2, the fixed cost of operating a business is f = 10. There are two countries, H and F, that initally do not trade. The countries differ only in the size of their economies with EH 100 > EF = 50. All the Krugman model assumptions hold regarding preferences, monopolistic competition, free entry, etc. = Starting from the closed economy, answer the following. a. Profits: Using A to denote the level of demand preceived by a typical firm in H, write the typical firm's profit function. Plug in the relevant numbers for the elasticity of substitution, the marginal cost, and the fixed cost, leaving AH as a constant. b. Profit Maximization: Take the derivative of the profit function and solve the first order condition for the optimal price. What is the optimal price charged? c. Free Entry: Now solve for the total number of entrants…What are the shortcomings of the grossman model
- IS/LM Model refers to the general equilibrium not macroeconomic equilibrium.The following data pertain to products A and B, both of which are purchased by Madame X. Initially, the prices of the products and quantities consumed are: PA = $10, QA = 3, PB = $10, QB = 7. Madame X has $100 to spend per time period. After a reduction in price of B, the prices and quantities consumed are: PA = $10, QA = 2.5, PB = $5, QB = 15. Assume that Madame X maximizes utility under both price conditions above. Also, note that if after the price reduction enough income were taken away from Madame X to put her back on the original indifference curve, she would consume this combination of A and B: QA = 1.5, QB = 9 Determine the change in consumption rate of good B due to (1) the substitution effect and (2) the income effect. Determine if product B is a normal, inferior, or Giffen good. Explain.Given the following demand and supply functions for the cobweb model, find theintertemporal equilibrium price and determine whether the equilibrium is stable.
- Briefly suggest Fiscal Policy or Monetary Policy Measures or Mix of Both to minimize the effects of this pandemic(covid-19) situation(b) Discuss the distinction and similarities between partial and general equilibrium analysis.Consider a standard Heckscher-Ohlin (HO) Model, where two countries Home and Foreign produce two goods, sugar and milk, using labour (L) and capital (K). Home is relatively labour abundant and Foreign is relatively capital abundant. Assume that sugar is relatively capital intensive and milk is relatively labour intensive. Answer the following questions: (i) Discuss the pattern of trade between the two countries. (li) Under what conditions factor price equalization may be obtained Discuss with help of a diagram showing the segment of equalizatie