PRINCIPLES OF MACROECONOMICS(LOOSELEAF)
7th Edition
ISBN: 9781260110920
Author: Frank
Publisher: MCG
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Chapter 12, Problem 2RQ
To determine
Describe the effects of recession in profit gains.
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You are a junior executive of a new cellular phone carrier called Technologies of the Future (TOF) that competes in the same market as Verizon Wireless, AT&T, and T-Mobile. You are asked to write a professional document that discusses the concepts below. Define Gross Domestic Product (GDP). Differentiate between Real GDP and Nominal GDP. Explain how the GDP of the U.S. may influence the sale of smartphones by TOF. What percentage of the GDP is attributed to the sale of cellular phones (including carrier services) in the United States? Define the Human Development Index (HDI). Explain if the HDI has an influence on the sale of smartphones in the U.S. Which aspect of the HDI might influence the sale of smartphones? Identify the target audience for the sale of smartphones in the U.S..
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Consider the following economy. In year 1, there are 40 identical homes occupied by the residents. Ten out of 40 homes are rented, and the remaining 30 are owner-occupied. The annual rent for each home is K dollars (where K stands for thousand). In the same year, 10 additional homes are built, however, they are not sold or occupied, in the country. The price of a newly constructed home in Year 1 is 50K dollars. In Year 2, there is a total of 50 occupied homes in the country of which 20 is rented and the remaining 30 is owner-occupied. The rent on a rental home decreases by 20% to 0.8K dollars. In year 2, there is no new construction. In year 3, there is a fire that destroys 5 owner-occupied homes so that only 45 homes are occupied. The annual rent increases back to K dollars per home. There is no new construction in Year 3. However, the government puts a big tent to shelter those who lost their homes in fire. In total, the government spends 2K dollars for this emergency housing of 5…
Consider the following economy. In year 1, there are 40 identical homes
occupied by the residents. Ten out of 40 homes are rented, and the remaining 30 are
owner-occupied. The annual rent for each home is K dollars (where K stands for
thousand). In the same year, 10 additional homes are built, however, they are not sold or
occupied, in the country. The price of a newly constructed home in Year 1 is 50K dollars.
In Year 2, there is a total of 50 occupied homes in the country of which 20 is rented and
the remaining 30 is owner-occupied. The rent on a rental home decreases by 20% to
0.8K dollars. In year 2, there is no new construction. In year 3, there is a fire that
destroys 5 owner-occupied homes so that only 45 homes are occupied. The annual rent
increases back to K dollars per home. There is no new construction in Year 3. However,
the government puts a big tent to shelter those who lost their homes in fire. In total,
the government spends 2K dollars for this emergency housing of 5…
Chapter 12 Solutions
PRINCIPLES OF MACROECONOMICS(LOOSELEAF)
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