Question

Questions 4 and 5 please

l 1B explain business-cycle fluctuations? What might ca ply curve nee such a shift? Section 11.7) An eco to initiate a major Bl Figure 11.11a.How does the inated by two industries, both of which are considering w labour sup- 11.7)An in vestment project. If both industries inves economy is dominated by two in industry makes tries invest, then em profits of $5 billion. However, if neither industry are h eake invests, the hakes $2 billion profit, but the additional costs of the investing makes $1 billion profit. If only one industry invests, them aconomy is weaker and each industry that try mean that it loses $1 billion assumes that the other one will not invest, what is their indus the (a) If each industry action? b) What if they assume e) What is the role (0) How do your optimal course of e that the other industry will invest? of changing business optimism in this economy? othe busi wers change when government offers an investment subsidy worth $3 bil- w jon to each industry? Is society better off? nd-demand model to analyse the impact of an oil price shock on After an increase in oil prices, what is likely to happen to profits, unemployment, How will this further affect your analysis? How useful is the 11.8) Use a supply-a Section 11.8) Use a the economy. income and consumer confidence? distinction between supply and demand shocks?

Answer 1

Answer 4)

4a) Assuning ot ohe indluday dors not imvest the olhek b) Tul invest b twill rf pf/if ) chonging bussines optision is ky sill not invet because if t ivet giver o usodd hove losses glib,mon ecause than ssnesS inve s even have to incuse coud yes sociaty is betts oy because pkaut andl enploymer is high in o4L İn.utsy u.kd, eventually rasse-hasiady S we hove 'on us,'' mean a en On ConsUM

Answer 5)