Macroeconomics
10th Edition
ISBN: 9780134896441
Author: ABEL, Andrew B., BERNANKE, Ben, CROUSHORE, Dean Darrell
Publisher: PEARSON
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Question
Chapter 5, Problem 2NP
To determine
To calculate: The relationship between net export and foreign lending. The calculation of the national saving, foreign lending, absorption, and net export.
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Draw the IS-LM diagram at equilibrium and use it to show how one or both of the curves change based on the following exogenous changes.
An increase in taxes.
An increase in the money supply
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Gross Domestic Product (GDP) represents the total value of all goods and services produced by a country. The news reporter shows excitement because rising GDP signifies positive economic performance. Consumer spending has increased while businesses expand and new job opportunities become available. If the GDP rises, your delivery business will likely handle more packages as consumer purchasing increases. The increase in business activity will lead to more opportunities for your company to generate higher profits. You may need to take action by hiring additional staff and purchasing extra delivery vehicles or finding ways to improve your operation speed and efficiency to meet increased demand.
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