a) Write out the equation that describes the Quantity Theory of Money. Must indicate clearly what each variable in the equation means in order to earn full marks .
Based on the equation, predict what would happen to inflation in the long run:

b). if the growth rate of the velocity of money is zero and money supply grows at a faster rate than real GDP growth rate. You may use some hypothetical numbers to illustrate your answer (1.5 marks)
c). if the growth rate of the velocity of money is zero and money supply grows at a slower rate than real GDP growth rate. Use some hypothetical numbers to show (1.5 marks)
d). Based on these two scenarios (b and c) and the quantity theory of money as stated in this question, what would be a good monetary policy for the economy in the long run?

a) Write out the equation that describes the Quantity Theory of Money. Must indicate clearly what each variable in the equation means in order to earn full marks .
Based on the equation, predict what would happen to inflation in the long run:

b). if the growth rate of the velocity of money is zero and money supply grows at a faster rate than real GDP growth rate. You may use some hypothetical numbers to illustrate your answer (1.5 marks)
c). if the growth rate of the velocity of money is zero and money supply grows at a slower rate than real GDP growth rate. Use some hypothetical numbers to show (1.5 marks)
d). Based on these two scenarios (b and c) and the quantity theory of money as stated in this question, what would be a good monetary policy for the economy in the long run?

ROUND ALL CALCULATIONS TO TWO (2) DECIMAL PLACES a. (15 pts) Please draw the Keynesian Cross assuming the following information. Be sure to specify at what point consumption and disposable income are equal. Marginal Propensity to Consume = .88 Autonomous Consumption = $525 b. (5 pts) Assume that your disposable income is $760. How much are you consuming? Are you saving or dissaving? c. (10 pts) Assume that autonomous consumption increases to $890. Please illustrate this change on graph from part a. Again, you must specify at what point consumption and disposable income are equal. d. (5 pts) Based on the change in part c, illustrate what will happen to aggregate demand.

1) Suppose that a firm’s production function is q=10L^0.25 K^0.75. The cost of a unit of labor is $30 and the cost of a unit of capital is $90. a. The firm is currently producing 120 units of output. Derive the cost-minimizing quantities of labor and capital (i.e. in the long run). What is the total cost?

b. The firm now wants to increase output to 160 units. If capital is fixed at the level you found in part a) (i.e. in the short run), how much labor will the firm require? What is the firm’s new total cost?

3. What is the cost-minimizing level of capital and labor in the long run if the firm wants to produce 160 units of output? What is the total cost now?

Give more details on the following answer

Question:

Give a detailed explanation about what is happening with the oil prices.

mention coronavirus, OPEC, Saudi Arabia.

give references

Answer:

Oil prices is dropping.Major causes behind the fall is given below:

• Increase in Supply.
• Decrease in demand and
• fall of monopoly power in oil producers.

The price of oil sunk to levels not seen since 2002 as demand for crude collapses amid the coronavirus pandemic.Oil prices have fallen by more than half during the past month as companies cut back or close production.Oil prices failed to keep pace,with growing (coronavirus)lock down measures and that could drive global demand down 20%,potentially pushing the world to run out of storage capacity.

Organization of petroleum exporting countries (OPEC) controls almost 80%of the world's oil reserves.OPEC is the main influencer in fluctuations in oil prices.OPEC and its allies due to covid 19 outbreak,agreed to historic production cuts to stabilize prices,but they dropped to 20 years lows.Supply and demand influences oil prices to change.From global perspective,political instability in middle east causes oil prices to change.

Saudi Arabia is the second largest oil producer in the world.It will suffer financially from cheap oil.It can afford temporary falls in oil prices because they have substantial reserves.If low prices persist,Saudi Arabia may have to cut back on some of the social programms.

References:

BBC News(30 March 2020) Coronavirus:oil price collapses to lowest level for 18 years

Why did policy makers reverse this stance and start welcoming FDI in the 80s and 90s? Provide an example of FDI in India by a foreign from that validates this policy reversal.

Describe how a company can avoid arbitrage if it wants to pursue price discrimination of the following products:

a. Beer for export; b. Vacuum cleaners – products at a discount are supposed to be offered to some buyers; c. Bus drives; d. Plastic that is an intermediate product with several applications.

The money supply is fixed at $60billion and the equilibrium value of money 1/P = 1/2. The Federal Reserve increases the money supply by $20 billion and as a result the new equilibrium price level is 5. Use the Money Supply-Demand Model (Diagram) to explain clearly how equilibrium is restored in the model.

2. A firm is operated under monopoly where there are two groups of customers. The market demand from group 1 is given by Q1 = 80 – P. The market demand from group 2 is given by Q2 = 40 – P/2. The firm’s marginal cost function is given by MC =20.

a. Total market demand is given by Q= Q1 + Q2 = 120 – 3P/2. Find the firm’s producer surplus from combining the two markets and set a single optimal price.

b. Find the firm’s total producer surplus from separating the two markets (third degree price discrimination.

c. Use price elasticity of each demand function to explain why the third-degree price discrimination in b. cannot increase the firm’s producer surplus

A semiprofessional baseball team near your town plays two home games each month at the local baseball park. The team splits the concessions 50/50 with the city but keeps all the revenue from ticket sales. The city charges the team $500  each month for the three-month season. The team pays the players and manager a total of $2500 each month. The team charges $10 for each ticket, and the average customer spends $7 at the concession stand. Attendance averages 100 people at each home game.

Part 1. The team earns an average of $________________ in revenue for each game and $______________ of revenue each season.

With total costs of $_____________ each season, the team finishes the season with $________________ of profit.

Part 2   In order to break even, the team needs to sell   tickets for each game. Round to the nearest whole number.

The Federal Reserve System was established to provide a stable monetary system for the entire economy. The Federal Reserve Bank (the Fed) has three major tools to control the money supply: 1) reserve requirements, 2) discount window for loans to member banks, and 3) open market operations.

When the economy is in a recessionary mode, what will likely be the actions by the Federal Reserve using monetary policy? Suppose the Federal Reserve purchases a $100,000 bond from John Doe, who deposits the proceeds in the Manufacturer's National Bank; what will be the impact of this transaction on the supply of money?

How do each of the Fed's tools work? What is the fractional reserve system, and how does it work in relation to the Fed? Review the Federal Reserve System and how the Fed alters the monetary base to achieve the levels of money supply in the economy.    

Comment on Robert D. Behn and James W. Vaupel’s quote on values reprinted in the text: “Decisions depend upon judgments—judgments about the nature of the dilemma, the probabilities of events, and the desirability of consequences. Decision-making is inherently subjective.” What do you think about this idea that decisions are subjective? Can you give an example of how you have witnessed your government make a decision that seemed more subjective than objective? How does that make you feel that the subjectivity of administrators is at work in their decision-making? How do the different approaches to decision-making treat “values,” and which ones seem more value driven than others?

If we accept that the marketplace is the regulator for those industries where there is no monopoly, do you think that the marketplace makes the same decisions as a regulator? Why or why not? What objectives would a regulator who is regulating a natural monopoly pursue? Are these the best goals? Why or why not?

As the owner of the only tennis club in an isolated wealthy​ community, you must decide on membership dues and fees for court time. There are two types of tennis players.​ "Serious" players have demand

Q1=12−P

where Q1 is court hours per week and P is the fee per hour for each individual player. There are also​ "occasional" players with demand

Q2=4−0.25P

Assume that there are1,000 players of each type. Because you have plenty of​ courts, the marginal cost of court time is ​$0.

You have fixed costs of ​$12,000 per week. Serious and occasional players look​ alike, so you must charge them the same prices.

a. Suppose that to maintain a​ "professional" atmosphere, you want to limit membership to serious players. How should you set the annual membership dues and court fees​ (assume 52 weeks per​ year) to maximize​ profits, keeping in mind the constraint that only serious players choose to​ join? What would profits be​ (per week)?  ​(round your answers to two decimal​ places)

The annual membership fee is:

The court fee is:

Weekly profit is:

b. A friend tells you that you could make greater profits by encouraging both types of players to join. Is your friend right? What annual dues and court fees would maximize weekly profits? What would these profits be? (round your answers to two decimal places)

The annual membership fee is:

The court fee is:

Weekly profit is:

c. Suppose that over the years, young, upwardly mobile professionals move to your community, all of whom are serious players. You believe there are now 3500 serious players and 1000 occasional players. Would it still be profitable to cater to the occasional player? What would be the profit-maximizing annual dues and court fees? What would profits be per week? (round your answers to two decimal places)

The annual membership fee is:

The court fee is:

Weekly profit is: