# All Questions

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### Inferior and normal good and the change in price of those goods

In general, We know that if a good is normal, then as your income increases, then demand of that good increases as well as price is fixed. Similarly, if a good is inferior, then as your income ...
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### Indiference between two lotteries

Suppose that a binary relation satisfies only: Independence axiom: $L≿L′⟺α\circ L+(1−α)\circ L′′≿α\circ L′+(1−α) \circ L′′$ Reduction to simple lotteries: For all $g$, $g~g'$, $g'$ is the simple ...
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### Economic impacts of Migration on the Labour Market

Many natives don't prefer foreigners taking their jobs, is it actually a bad thing for the countries economy?
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### Productivity issue

Could someone help with the following? Company produces products of daily demand. It employs workers In number of 12 people (HER) Wages of workers. The costs of hiring and firing are 25 per employee, ...
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### Calculate real GDP

Assume that the annual growth GDP per capita is 2%, how much will the real GDP per capita increase in 10 years. I know the manual way is to take 2 percent every years. For example after 1 year would ...
108 views

### Stochastic process difference equation: stationary distribution

How can I find the stationary distribution (as t goes to infinity) of stochastic difference equations in the form: $x_{t+1} = a*x_t + b*N(0,1)$ where N(0,1) is a standard normal pdf I have ...
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### How much of an assets price change is due to speculators and functional buys/sellers

If (for example) a heavily traded asset like crude oil has a price move of x, how much of that is influenced by functional buyers/sellers and how much by speculators? Let's say x is +100, there are 8 ...
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### Inflation and stock price

I have indicated my understanding and problem on the attached image below. I'm a bit confused on the impact of inflation on stock price. As increase in inflation would cause nominal interest rate to ...
39 views

### Central Banks Currency being used as value keeping hypothesis

I recently came up with the idea that all the worlds currencies with central banks may be being used as a way to steal value from people who give value to them. And no, im not talking about inflation (...
1k views

### What is the difference between quoted price and theoretical value of a bond?

When we refer to "quoted price" of bond, or "clean price", it is equivalent to refer to his "present value" or "theoretical value", which corresponds to the price that I invest in the bond? For ...
1k views

### Quick Question on Production Possibilities Frontier Curve

Can someone please tell me how or why the curve shifts outward. In the textbook, I was given that: "But if we cut production of mobile phones to 3 million this year, we can produce 2 mobile phone ...
77 views

### New-Keynesian-Economics

interest rate in Talor rule is considered as endogenous or exogenous? Similarly there are some fiscal policy rules in assuming fiscal instrumens like government expenditure and distortionary taxes ...
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### Explain inflation to an economic novice

I'm trying to get a grasp on how exactly inflation works. What I've read so far seems to be contradictory. In some articles I've read that government spending is always(?) inflationary, and in ...
2k views

### Advanced Microeconomics: Deriving Slutsky Equation

I am not sure how to derive the demand for consumption of today's bread; the first thing the problem asks for. I think it might be a piecewise function based on the interest rate that gets you from ...
4k views

### What is the list of countries where the central bank prints money?

Is there a list of the countries where the central bank is creating money, today ? How much ? We know for: EUR: Euro countries (since ECB QEs) (and euro-bound countries as DKK ?) YEN: Japan (BOJ '...
49 views

### Including variable with causation problem for estimating from LISS

I am using panel data from the LISS to estimate the effect of whether a person practices sport or not on appreciation of leisure time (scale 0-10). My partner insists on using a variable that ...
242 views

### Price Optimization from Data

How can I find the optimal price that maximizes profits, given past sales data? I thought I could do this, but I've been running into problems. Data: ...
44 views

### Meaning of Exchange rate

Does exchange rate of local currency relative to US dollar mean LOC/USD or USD/LOC ?
117 views

### Why does a weaker currency make sovereign debt cheaper?

Investopedia tells me that a weaker currency will reduce sovereign debt burdens. It is quoted as saying 'a weaker currency makes [these] payments effectively less expensive over time.' However, I ...
30 views

### CEO Compensation in Banking Data

My main goal is to compare CEO compensation for banks across different countries. Does anybody know where I can find data on CEO compensation for banks for different countries or a paper which ...
515 views

### Balance of Trade - Currency devaluation in a price taker economy

How will a real exchange rate devaluation affect Balance of Trade, if an economy is a price taker in world markets for both export and import?
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### Does demand side economics only apply to manufacturing

For example, if investment falls then manufacturing falls. but there is no investment in secondary markets. Wouldn't recessions cause factories to collapse but why would they affect realtors, used ...
57 views

### How does real gdp affect the domestic currency?

When the domestic real gdp per capita increases then it has a negative effect on domestic currency (depreciation)? Why? Source: The real exchange rate of euro and Greek economic growth, Gregory T. ...
25 views

### Question about Static Game with 3 firms

I need an answer to the following question. I can't quite get the approach to answer it using a cournot competition model. Consider a static price competition game of three firms; each owns a product. ...
51 views

### Is it detrimental if self-interest is not acknowledged in resource allocation situations?

Please note: I am doing a literature survey/review, and I would like references to published work. I contend that if we are dealing with a resource allocation mechanism that allocates scarce ...
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### What are ways in which world markets are zero-sum games?

Mercantilism is notorious for treating the world economy as a zero-sum game, wherein the local economy is supposed to benefit when regulations that operate to the detriment of foreign economies are in ...
278 views

### Maximizing a Cobb-Douglas Function

Suppose that a competitive firm receives a price of $P$ for its output, and pays prices of w, r and v for its labor $(L)$, capital $(K)$ and natural resources $(R)$ inputs, respectively. The firm ...
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### Why don't we mint more m0 instead of creating m1 through fractional reserve banking?

From what I understand, m1 money is just as liquid as m0 since an individual can withdraw it from the bank at any time and in any quantity (up to the amount (s)he deposited). Because of this I don't ...
64 views

### Why don't banks just buy m0 and create unlimited loans?

In fractional reserve banking a bank can buy m0 and use it to create any amount of m1/m2. Why don't they do this? The loans could be just banks lending each other at 0% interest to create unlimited ...
54 views

### Beta delta Agent - Consumption decision

I’m struggling with a problem regarding the beta delta agent. Can someone give me a hint how I can come up with the levels of utility? Thanks in advance!
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### Causality: Money supply and prices

When there is an increase in price level, real money supply decreases and raises interest rates. In a similar situation, when money supply decreases, interest rates increases, consumption decreases, ...
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### How does the cost of switching over to green energy compare to the cost of the war in Iraq?

How does the cost of switching over to wholly green technology in the US at current prices and at current technology without factoring in possible improvements in efficiency or technology solely in ...
58 views

### What happens to demand economics when rates are negative?

Keynesian economics assumes falling lending opportunity lowers profit. Under negative rates less lending actually means More Profit. So how does this change things?
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### Production function question

Some help with this would be appreciated.
58 views

### Why doesn't the Federal government just let the stock market crash?

In a normal financial crisis the government tries to maintain the stock market prices to prevent a spike in unemployment as companies collapse and run layoffs. But given that we're in the midst on a ...
32 views

### Meaning of the sentence

I am having trouble understanding this economic concept: Consumer can obtain maximum utility only if he/she incurs expenditure on various commodities in such a manner as to equalise marginal ...
40 views

### what would be an efficient investment when central banks have massive qe?

Recently the central bank said in a statement on its website. “Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift ...
36 views

### How is patience modelled?

How is consumer patience modelled? My first thought was "discount factors, but the problem is that it doesn't seem to capture the intuitive notion of what being patient means. For example, the ...
53 views

### Why do large financial institutions make international transactions in digital currency?

I've heard that blockchain technology has been used extensively by financial institutions when making international transactions to eachother, with speed and transparency and cryptographic security ...
79 views

### How do currency traders resolve imbalances in the demand for different currencies?

Countries trade different amounts of goods that are inherently imbalanced. How do currency traders resolve these imbalances in the demand for different currencies? For example.... Imagine we have two ...