This is a history of economic thoughts question1 Contemporary microeconomics has its roots in Adam Smith's "theory of the freemarket"(a) Identify and discuss the key assumptions of this theory(b) Identify and discuss the main predictions of this theory and examine theirpolicy implications.(c) Identify and examine the two main circumstances under which the theory'spredictions fail to hold(d) Demonstrate how post-Smithlan developments in microeconomics haveresolved the problems posed in (c) above

''since you have posted the question with multiple sub parts, we will solve first three sub-parts…

Answered: (a) Identify and discuss the key…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

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Given the following AD/AS/RE model: yt d = mt – pt + Ot [1] yt s = pt – Et-1pt + et [2] mt = V + Syt-1+ zt [3] Ot = pOt-1+ Kt , ɛt = þet-1 + At [4] where kt , At and zt have means of zero and variances oK 2 , 0^ 2 , oz 2 , and agents can observe all current variables. a) Explain what economic behaviour each of equations [1], [2] and [3] represents. b) Find equilibrium price and output. c) Explain whether, and why, stabilisation policy is effective or ineffective in this case.
Please Show ALL Workings VERY CLEARLY! dynamic stability
Sizable tax returns that result from automatic prepayment of taxes should(A) increase tax fraud;(B) decrease tax fraud;(C) increase procrastination;(D) decrease procrastination. This effect is achieved because of(A) the Independence axiom;(B) reference dependence;(C) impatience;(D) time consistency. can you help me answer the bolded question?
Y8 Analysis on the perceived occurrence of challenges delaying the delivery of water infrastructure assets in South AfricaIntroductionInfrastructure development is of paramount importance for a sustainable economy that is competitive and productive. However, inflexible government’s fiscal policies, high budget deficits and lack of debt reduction strategies experienced by the public sector directly affect infrastructure development (Ruiters and Matji, 2015). The public sector experiences challenges of provisioning for public infrastructure assets. There are many challenges delaying infrastructure development. The study explored infrastructure backlog and deficits as alarming challenges to adequately fund and deliver water infrastructure assets in South Africa. Kudumela (2015) outlines challenges of infrastructure development: insufficient skills capacity at the municipal level, lack of funding, political instability and corruption, while Senyakoe (2011) indicates that municipalities…
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Question: Common stock value – All growth models. Personal Finance Problem. You are evaluating thepotential purchase of a small business currently generating $40,000 of after-tax cash flow. Thecompany has $25,000 of Preferred Stock and $150,000 of debt.(FCF0 = $40,000). On the basis of a review of similar-risk investment opportunities, you must earn arate of return of Common stock value – All growth models. Personal Finance Problem. You are evaluating thepotential purchase of a small business currently generating $40,000 of after-tax cash flow. Thecompany has $25,000 of Preferred Stock and $150,000 of debt.(FCF0 = $40,000). On the basis of a review of similar-risk investment opportunities, you must earn arate of return of 9% on the proposed purchase. Because you are relatively uncertain about future cashflows, you decide to estimate the firm’s common stock value using three possible assumptions aboutthe growth rate of cash flows. 1. What is the firm's value if cash flows are expected…
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Consider the “Trip Logistic” example discussed in class (i.e. base case). Please solve the same problem with each of the following changes, and compare the results with those of the basecase: a) The spot market price (in period 0) is reduced to $0.55 per sq. ft. per year. Assume that everything else remains the same as the base-case. b) There is a lower demand uncertainty: Demand can go up by 5% with p= 0.5 or down by 5% with 1 − p= 0.5. Assume that everything else remains the same as the base-case.
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i need this in words not handwritten just Rewrite this
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(a) Identify and discuss the key assumptlons of this theory (b) Identify and discuss the maln predictions of this theory and examine their policy implications. (c) Identify and examine the two main circumstances under which the theory's predictions fall to hold