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    (Original post by JanoBano)
    Whoa really. Never seen an upwards shift in the Keynesian LRAS curve (long run or short run). Anyone any input on this??:eek:
    Also, I doubt you are screwed. You're pretty good at all of this - I can predict your A. Hehe
    Me neither, but that's what I head :indiff:

    Tbh, as I just said in a previous post, for all intents and purposes, any standard AD/AS curve will work fine (I hope!).
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    Oh btw, to what extent might a high national debt to GDP ratio be a cause for concern?
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    (Original post by jayshah31)
    Oh wait, are you saying the elastic bit of the curve is the SRAS and the inelastic bit LRAS?

    Please tell me you are :redface:
    Nope, youi draw an inelastic one seperately. I wouldn't worry I only draw that curved thing. I can't find a picture of a laffer curve anywhere-an someone tell me what the axis are labelled and what shape it is-I predict a curved one.

    Also-philips curve & recession with inflation and unemployment at first?!?!
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    (Original post by Grape190190)
    Off-topic: Are you in some way connected with Sierra Leone (just noticed the flag)? I went there this October.
    Im from there originally. Moved to the Uk. Whats your connection?
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    (Original post by JanoBano)
    Whoa really. Never seen an upwards shift in the Keynesian LRAS curve (long run or short run). Anyone any input on this??:eek:
    Also, I doubt you are screwed. You're pretty good at all of this - I can predict your A. Hehe
    An upward shift represents cost-push inflation I think, where costs of productions such as the price of imports of raw materials go up.
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    (Original post by Stefano46)
    Oh btw, to what extent might a high national debt to GDP ratio be a cause for concern?
    Hmmm, I'll pretend I'm in an exam and won't do any research on this one - I've never actually heard of this :indiff:

    - Effects on taxes
    => May have to rise in order to pay deficit
    => E: Laffer curve - lowering taxes could actually lower national debt through increased revenue from incentives to work

    - Effects on FDI/confidence
    => Less confidence from investors
    => Higher interest rates may have to attract investors at the cost of consumer spending
    => E: Depends on how high the ratio actually is. What is "high", some arbitrary relative measure against what?

    - Long run problems
    => Cause for concern if it exists over a long period of time
    => Confidence in government and fiscal policies may fall

    - Govt. spending
    => It needs to be financed somehow - cutting spending
    => Opportunity cost of doing so
    => Servicing costs - opportunity costs of the interest payments
    => Links to crowding out.

    Hope this helps
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    (Original post by illy123)
    Current account deficit, in rough terms, is due to a rise in imports and a fall in exports. Hence, as imports rise more pounds are being supplied and as exports fall fewer pounds are being demanded.

    Draw S/D, new equilibrium price is lower than before ...

    a.k.a advantages of a floating ER; partial automatic correction of the BoP
    Thanks
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    (Original post by TomTeeTom)
    .
    I've always loved your sig. btw (inflation statement) :o:
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    http://www.economicshelp.org/images/...D-increase.jpg

    this link shows u a keynesian as/ad diagram.

    for the LRAS just draw a vertical line over the Y2.

    sry i wud of directly copied the image but i didnt know how to :p:
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    (Original post by TomTeeTom)
    Im from there originally. Moved to the Uk. Whats your connection?

    Oh coooooooool.

    My school has a link with a school in Freetown, and sends ten of us, plus two or three staff over every Autumn. I had suuuuuuuch a great time, incredibly interesting place. And I met the President.
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    (Original post by leala4628)
    Nope, youi draw an inelastic one seperately. I wouldn't worry I only draw that curved thing. I can't find a picture of a laffer curve anywhere-an someone tell me what the axis are labelled and what shape it is-I predict a curved one.

    Also-philips curve & recession with inflation and unemployment at first?!?!
    Laffer curve: x-axis is Tax Rate, and y-axis is Government Revenue. But, someone confirm thisssss plz. And it's curved like.. wait, actually here's a pic (attached)
    Attached Images
     
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    (Original post by Grape190190)
    But I always get confuzzled because some people say that the Keynesian LR is the SR.
    I hope this diagram will clear things up:

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    (Original post by JanoBano)
    Laffer curve: x-axis is Tax Rate, and y-axis is Government Revenue. But, someone confirm thisssss plz. And it's curved like.. wait, actually here's a pic (attached)
    yeah that's right, but I think it goes from 0% to 100% along the bottom
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    (Original post by JanoBano)
    Laffer curve: x-axis is Tax Rate, and y-axis is Government Revenue. But, someone confirm thisssss plz. And it's curved like.. wait, actually here's a pic (attached)
    Thanks
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    Help!
    To what extent do trading blocs conflict with WTO interests?
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    (Original post by Sports Racer)
    I hope this diagram will clear things up:

    Sorta. Basic point being that once you reach a certain price, increasing AD and therefore the price will have no impact on output?
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    (Original post by iPod)
    Help!
    To what extent do trading blocs conflict with WTO interests?
    WTO wants to promote free trade. Trading blocs often set up barriers to trade. But on the other hand, they don't always, and trading blocs trade freely with each other.
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    (Original post by iPod)
    Help!
    To what extent do trading blocs conflict with WTO interests?
    Free trade between trace docs are pro-globalisation, but CETs (common external tariffs) are pro-protectionism.
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    (Original post by leala4628)
    .
    Hang on, wasn't this what I said?

    Elastic bit is SRAS and the inelastic part is LRAS?
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    Transmission mechanism. Remind me.

    Interest rates go up, therefore people save more and borrow less. Therefore, there's less money with which to demand goods and services. Keeps prices low. amirite?
 
 
 

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